Correlation Between Metallic Minerals and Adamera Minerals

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

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

Diversification Opportunities for Metallic Minerals and Adamera Minerals

0.14

Correlation Coefficient

Metallic Minerals  Adamera Minerals

Average diversification

The 3 months correlation between Metallic and Adamera is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Metallic Minerals Corp and Adamera Minerals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adamera Minerals Corp and Metallic Minerals 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 Metallic Minerals Corp are associated (or correlated) with Adamera Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adamera Minerals Corp has no effect on the direction of Metallic Minerals i.e., Metallic Minerals and Adamera Minerals go up and down completely randomly.

Pair Corralation between Metallic Minerals and Adamera Minerals

If you would invest  2.00  in Adamera Minerals Corp on September 5, 2024 and sell it today you would earn a total of  0.00  from holding Adamera Minerals Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Metallic Minerals Corp  vs.  Adamera Minerals Corp

Metallic Minerals Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Metallic Minerals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Adamera Minerals Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Adamera Minerals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Adamera Minerals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Metallic Minerals and Adamera Minerals

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

The idea behind Metallic Minerals Corp and Adamera Minerals 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 Commodity Directory module to find actively traded commodities issued by global exchanges.