Correlation Between EMX Royalty and Materion

Can any of the company-specific risk be diversified away by investing in both EMX Royalty and Materion at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining EMX Royalty and Materion into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EMX Royalty Corp and Materion, you can compare the effects of market volatilities on EMX Royalty and Materion and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in EMX Royalty with a short position of Materion. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMX Royalty and Materion.

Diversification Opportunities for EMX Royalty and Materion

-0.17

Correlation Coefficient

EMX Royalty  Materion

Good diversification

The 3 months correlation between EMX and Materion is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding EMX Royalty Corp and Materion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materion and EMX Royalty is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on EMX Royalty Corp are associated (or correlated) with Materion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materion has no effect on the direction of EMX Royalty i.e., EMX Royalty and Materion go up and down completely randomly.

Pair Corralation between EMX Royalty and Materion

Considering the 90-day investment horizon EMX Royalty Corp is expected to generate 0.84 times more return on investment than Materion. However, EMX Royalty Corp is 1.19 times less risky than Materion. It trades about 0.04 of its potential returns per unit of risk. Materion is currently generating about -0.19 per unit of risk. If you would invest  174.00  in EMX Royalty Corp on December 1, 2024 and sell it today you would earn a total of  5.00  from holding EMX Royalty Corp or generate 2.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

EMX Royalty Corp  vs.  Materion

EMX Royalty Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in EMX Royalty Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong primary indicators, EMX Royalty is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Materion

Risk-Adjusted Performance

Very Weak

Over the last 90 days Materion has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with EMX Royalty and Materion

The main advantage of trading using opposite EMX Royalty and Materion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMX Royalty position performs unexpectedly, Materion can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Materion will offset losses from the drop in Materion's long position.

The idea behind EMX Royalty Corp and Materion pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bonds Directory module to find actively traded corporate debentures issued by US companies.