Correlation Between Alexco Resource and Maverix Metals

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

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

Diversification Opportunities for Alexco Resource and Maverix Metals

0.0

Correlation Coefficient

Alexco Resource  Maverix Metals

Pay attention - limited upside

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

Pair Corralation between Alexco Resource and Maverix Metals

If you would invest (100.00) in Maverix Metals on January 25, 2024 and sell it today you would earn a total of  100.00  from holding Maverix Metals or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Alexco Resource Corp  vs.  Maverix Metals

Alexco Resource Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alexco Resource Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Alexco Resource is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Maverix Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maverix Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong primary indicators, Maverix Metals is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alexco Resource and Maverix Metals

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

The idea behind Alexco Resource Corp and Maverix Metals 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.