Correlation Between MAG Silver and APPTECH CORP

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Can any of the company-specific risk be diversified away by investing in both MAG Silver and APPTECH CORP 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 MAG Silver and APPTECH CORP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAG Silver Corp and APPTECH CORP, you can compare the effects of market volatilities on MAG Silver and APPTECH CORP 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 MAG Silver with a short position of APPTECH CORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAG Silver and APPTECH CORP.

Diversification Opportunities for MAG Silver and APPTECH CORP

0.33
  Correlation Coefficient

Weak diversification

The 3 months correlation between MAG Silver and APPTECH is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MAG Silver Corp and APPTECH CORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPTECH CORP and MAG 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 MAG Silver Corp are associated (or correlated) with APPTECH CORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPTECH CORP has no effect on the direction of MAG Silver i.e., MAG Silver and APPTECH CORP go up and down completely randomly.

Pair Corralation between MAG Silver and APPTECH CORP

Considering the 90-day investment horizon MAG Silver Corp is expected to generate 0.48 times more return on investment than APPTECH CORP. However, MAG Silver Corp is 2.07 times less risky than APPTECH CORP. It trades about 0.27 of its potential returns per unit of risk. APPTECH CORP is currently generating about -0.12 per unit of risk. If you would invest  1,301  in MAG Silver Corp on August 28, 2022 and sell it today you would earn a total of  272.00  from holding MAG Silver Corp or generate 20.91% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

MAG Silver Corp  vs.  APPTECH CORP

 Performance (%) 
       Timeline  
MAG Silver Corp 
MAG Silver Performance
8 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in MAG Silver Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, MAG Silver exhibited solid returns over the last few months and may actually be approaching a breakup point.

MAG Silver Price Channel

APPTECH CORP 
APPTECH Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in APPTECH CORP are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal fundamental indicators, APPTECH CORP showed solid returns over the last few months and may actually be approaching a breakup point.

APPTECH Price Channel

MAG Silver and APPTECH CORP Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with MAG Silver and APPTECH CORP

The main advantage of trading using opposite MAG Silver and APPTECH CORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAG Silver position performs unexpectedly, APPTECH CORP 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 APPTECH CORP will offset losses from the drop in APPTECH CORP's long position.
MAG Silver vs. Aya Gold Silver
The idea behind MAG Silver Corp and APPTECH 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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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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