Correlation Between CITY OFFICE and SITKA GOLD
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and SITKA GOLD 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 CITY OFFICE and SITKA GOLD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and SITKA GOLD P, you can compare the effects of market volatilities on CITY OFFICE and SITKA GOLD 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 CITY OFFICE with a short position of SITKA GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and SITKA GOLD.
Diversification Opportunities for CITY OFFICE and SITKA GOLD
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between CITY and SITKA is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and SITKA GOLD P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SITKA GOLD P and CITY OFFICE 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 CITY OFFICE REIT are associated (or correlated) with SITKA GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SITKA GOLD P has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and SITKA GOLD go up and down completely randomly.
Pair Corralation between CITY OFFICE and SITKA GOLD
Assuming the 90 days horizon CITY OFFICE is expected to generate 3.16 times less return on investment than SITKA GOLD. But when comparing it to its historical volatility, CITY OFFICE REIT is 2.22 times less risky than SITKA GOLD. It trades about 0.05 of its potential returns per unit of risk. SITKA GOLD P is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9.95 in SITKA GOLD P on September 14, 2024 and sell it today you would earn a total of 13.05 from holding SITKA GOLD P or generate 131.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.64% |
| Values | Daily Returns |
CITY OFFICE REIT vs. SITKA GOLD P
Performance |
| Timeline |
| CITY OFFICE REIT |
| SITKA GOLD P |
CITY OFFICE and SITKA GOLD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and SITKA GOLD
The main advantage of trading using opposite CITY OFFICE and SITKA GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, SITKA GOLD 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 SITKA GOLD will offset losses from the drop in SITKA GOLD's long position.| CITY OFFICE vs. Office Properties Income | CITY OFFICE vs. CREMECOMTRSBI DL 001 | CITY OFFICE vs. Superior Plus Corp | CITY OFFICE vs. SIVERS SEMICONDUCTORS AB |
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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 the Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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