Correlation Between Highland Surprise and EMX Royalty

Can any of the company-specific risk be diversified away by investing in both Highland Surprise and EMX Royalty 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 Highland Surprise and EMX Royalty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Highland Surprise Consolidated and EMX Royalty Corp, you can compare the effects of market volatilities on Highland Surprise and EMX Royalty 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 Highland Surprise with a short position of EMX Royalty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Surprise and EMX Royalty.

Diversification Opportunities for Highland Surprise and EMX Royalty

0.0

Correlation Coefficient

Highland Surprise  EMX Royalty

Pay attention - limited upside

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

Pair Corralation between Highland Surprise and EMX Royalty

If you would invest  167.00  in EMX Royalty Corp on December 20, 2024 and sell it today you would earn a total of  22.00  from holding EMX Royalty Corp or generate 13.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	16.67%
Values	Daily Returns

Highland Surprise Consolidated  vs.  EMX Royalty Corp

Highland Surprise

Risk-Adjusted Performance

Very Weak

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

EMX Royalty Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EMX Royalty Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak primary indicators, EMX Royalty showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Highland Surprise and EMX Royalty

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

The idea behind Highland Surprise Consolidated and EMX Royalty Corp 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.