Correlation Between Summit Materials and Santacruz Silver
Can any of the company-specific risk be diversified away by investing in both Summit Materials and Santacruz Silver 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 Summit Materials and Santacruz Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Materials and Santacruz Silver Mining, you can compare the effects of market volatilities on Summit Materials and Santacruz Silver 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 Summit Materials with a short position of Santacruz Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Materials and Santacruz Silver.
Diversification Opportunities for Summit Materials and Santacruz Silver
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Summit and Santacruz is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Summit Materials and Santacruz Silver Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santacruz Silver Mining and Summit Materials 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 Summit Materials are associated (or correlated) with Santacruz Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santacruz Silver Mining has no effect on the direction of Summit Materials i.e., Summit Materials and Santacruz Silver go up and down completely randomly.
Pair Corralation between Summit Materials and Santacruz Silver
Assuming the 90 days trading horizon Summit Materials is expected to generate 2.45 times less return on investment than Santacruz Silver. But when comparing it to its historical volatility, Summit Materials is 5.13 times less risky than Santacruz Silver. It trades about 0.14 of its potential returns per unit of risk. Santacruz Silver Mining is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Santacruz Silver Mining on September 22, 2024 and sell it today you would earn a total of 1.00 from holding Santacruz Silver Mining or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Materials vs. Santacruz Silver Mining
Performance |
| Timeline |
| Summit Materials |
| Santacruz Silver Mining |
Summit Materials and Santacruz Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Materials and Santacruz Silver
The main advantage of trading using opposite Summit Materials and Santacruz Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Materials position performs unexpectedly, Santacruz Silver 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 Santacruz Silver will offset losses from the drop in Santacruz Silver's long position.| Summit Materials vs. Apple Inc | Summit Materials vs. Apple Inc | Summit Materials vs. Apple Inc | Summit Materials vs. Apple Inc |
| Santacruz Silver vs. MCEWEN MINING INC | Santacruz Silver vs. ADRIATIC METALS LS 013355 | Santacruz Silver vs. KENNAMETAL INC | Santacruz Silver vs. AAC TECHNOLOGHLDGADR |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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