Correlation Between Gatos Silver and Hunter Creek

Can any of the company-specific risk be diversified away by investing in both Gatos Silver and Hunter Creek 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 Gatos Silver and Hunter Creek into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gatos Silver and Hunter Creek Mining, you can compare the effects of market volatilities on Gatos Silver and Hunter Creek 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 Gatos Silver with a short position of Hunter Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gatos Silver and Hunter Creek.

Diversification Opportunities for Gatos Silver and Hunter Creek

0.0

Correlation Coefficient

Gatos Silver  Hunter Creek

Pay attention - limited upside

The 3 months correlation between Gatos and Hunter is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Gatos Silver and Hunter Creek Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunter Creek Mining and Gatos Silver 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 Gatos Silver are associated (or correlated) with Hunter Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunter Creek Mining has no effect on the direction of Gatos Silver i.e., Gatos Silver and Hunter Creek go up and down completely randomly.

Pair Corralation between Gatos Silver and Hunter Creek

If you would invest  610.00  in Gatos Silver on October 9, 2024 and sell it today you would earn a total of  898.00  from holding Gatos Silver or generate 147.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.2%
Values	Daily Returns

Gatos Silver  vs.  Hunter Creek Mining

Gatos Silver

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gatos Silver has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Gatos Silver is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Hunter Creek Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hunter Creek Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Hunter Creek is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Gatos Silver and Hunter Creek

The main advantage of trading using opposite Gatos Silver and Hunter Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gatos Silver position performs unexpectedly, Hunter Creek 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 Hunter Creek will offset losses from the drop in Hunter Creek's long position.

The idea behind Gatos Silver and Hunter Creek Mining 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.