Correlation Between Silver Tiger and Viscount Mining

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

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

Diversification Opportunities for Silver Tiger and Viscount Mining

0.66

Correlation Coefficient

Silver Tiger  Viscount Mining

Poor diversification

The 3 months correlation between Silver and Viscount is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Silver Tiger Metals and Viscount Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viscount Mining Corp and Silver Tiger 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 Silver Tiger Metals are associated (or correlated) with Viscount Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viscount Mining Corp has no effect on the direction of Silver Tiger i.e., Silver Tiger and Viscount Mining go up and down completely randomly.

Pair Corralation between Silver Tiger and Viscount Mining

Assuming the 90 days horizon Silver Tiger is expected to generate 2.16 times less return on investment than Viscount Mining. But when comparing it to its historical volatility, Silver Tiger Metals is 1.05 times less risky than Viscount Mining. It trades about 0.14 of its potential returns per unit of risk. Viscount Mining Corp is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  16.00  in Viscount Mining Corp on December 30, 2024 and sell it today you would earn a total of  25.00  from holding Viscount Mining Corp or generate 156.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Silver Tiger Metals  vs.  Viscount Mining Corp

Silver Tiger Metals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Silver Tiger Metals are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Silver Tiger reported solid returns over the last few months and may actually be approaching a breakup point.

Viscount Mining Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Viscount Mining Corp are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Viscount Mining reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Silver Tiger and Viscount Mining

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

The idea behind Silver Tiger Metals and Viscount Mining 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.