Correlation Between SPECTRAL MEDICAL and First Quantum

Can any of the company-specific risk be diversified away by investing in both SPECTRAL MEDICAL and First Quantum 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 SPECTRAL MEDICAL and First Quantum into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SPECTRAL MEDICAL and First Quantum Minerals, you can compare the effects of market volatilities on SPECTRAL MEDICAL and First Quantum 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 SPECTRAL MEDICAL with a short position of First Quantum. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPECTRAL MEDICAL and First Quantum.

Diversification Opportunities for SPECTRAL MEDICAL and First Quantum

-0.49

Correlation Coefficient

SPECTRAL MEDICAL  First Quantum

Very good diversification

The 3 months correlation between SPECTRAL and First is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding SPECTRAL MEDICAL and First Quantum Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Quantum Minerals and SPECTRAL MEDICAL 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 SPECTRAL MEDICAL are associated (or correlated) with First Quantum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Quantum Minerals has no effect on the direction of SPECTRAL MEDICAL i.e., SPECTRAL MEDICAL and First Quantum go up and down completely randomly.

Pair Corralation between SPECTRAL MEDICAL and First Quantum

Assuming the 90 days horizon SPECTRAL MEDICAL is expected to under-perform the First Quantum. In addition to that, SPECTRAL MEDICAL is 1.09 times more volatile than First Quantum Minerals. It trades about 0.0 of its total potential returns per unit of risk. First Quantum Minerals is currently generating about 0.22 per unit of volatility. If you would invest  1,150  in First Quantum Minerals on April 24, 2025 and sell it today you would earn a total of  363.00  from holding First Quantum Minerals or generate 31.57% return on investment over 90 days.

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

SPECTRAL MEDICAL  vs.  First Quantum Minerals

SPECTRAL MEDICAL

Risk-Adjusted Performance

Very Weak

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

First Quantum Minerals

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in First Quantum Minerals are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, First Quantum reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SPECTRAL MEDICAL and First Quantum

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

The idea behind SPECTRAL MEDICAL and First Quantum Minerals 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.