Correlation Between Triple Flag and Gatos Silver

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

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

Diversification Opportunities for Triple Flag and Gatos Silver

0.0

Correlation Coefficient

Triple Flag  Gatos Silver

Pay attention - limited upside

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

Pair Corralation between Triple Flag and Gatos Silver

If you would invest  1,489  in Triple Flag Precious on December 28, 2024 and sell it today you would earn a total of  450.00  from holding Triple Flag Precious or generate 30.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Triple Flag Precious  vs.  Gatos Silver

Triple Flag Precious

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Triple Flag Precious are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Triple Flag displayed solid returns over the last few months and may actually be approaching a breakup point.

Gatos Silver

Risk-Adjusted Performance

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.

Pair Trading with Triple Flag and Gatos Silver

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

The idea behind Triple Flag Precious and Gatos Silver 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.

Check out your portfolio center.

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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.