Correlation Between MAG SILVER and Graham Holdings

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

By analyzing existing cross correlation between MAG SILVER and Graham Holdings Co, you can compare the effects of market volatilities on MAG SILVER and Graham Holdings 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 Graham Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAG SILVER and Graham Holdings.

Diversification Opportunities for MAG SILVER and Graham Holdings

-0.14

Correlation Coefficient

MAG SILVER  Graham Holdings

Good diversification

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

Pair Corralation between MAG SILVER and Graham Holdings

Assuming the 90 days trading horizon MAG SILVER is expected to generate 2.27 times more return on investment than Graham Holdings. However, MAG SILVER is 2.27 times more volatile than Graham Holdings Co. It trades about 0.17 of its potential returns per unit of risk. Graham Holdings Co is currently generating about -0.06 per unit of risk. If you would invest  1,358  in MAG SILVER on April 24, 2025 and sell it today you would earn a total of  485.00  from holding MAG SILVER or generate 35.71% return on investment over 90 days.

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

MAG SILVER  vs.  Graham Holdings Co

MAG SILVER

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MAG SILVER are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, MAG SILVER unveiled solid returns over the last few months and may actually be approaching a breakup point.

Graham Holdings

Risk-Adjusted Performance

Very Weak

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

Pair Trading with MAG SILVER and Graham Holdings

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

The idea behind MAG SILVER and Graham Holdings Co 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.