Correlation Between Advantage Solutions and Sarama Resources
Can any of the company-specific risk be diversified away by investing in both Advantage Solutions and Sarama Resources 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 Advantage Solutions and Sarama Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advantage Solutions and Sarama Resources, you can compare the effects of market volatilities on Advantage Solutions and Sarama Resources 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 Advantage Solutions with a short position of Sarama Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advantage Solutions and Sarama Resources.
Diversification Opportunities for Advantage Solutions and Sarama Resources
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Advantage and Sarama is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Advantage Solutions and Sarama Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarama Resources and Advantage Solutions 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 Advantage Solutions are associated (or correlated) with Sarama Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarama Resources has no effect on the direction of Advantage Solutions i.e., Advantage Solutions and Sarama Resources go up and down completely randomly.
Pair Corralation between Advantage Solutions and Sarama Resources
Assuming the 90 days horizon Advantage Solutions is expected to generate 1.36 times more return on investment than Sarama Resources. However, Advantage Solutions is 1.36 times more volatile than Sarama Resources. It trades about -0.02 of its potential returns per unit of risk. Sarama Resources is currently generating about -0.06 per unit of risk. If you would invest 2.50 in Advantage Solutions on September 5, 2024 and sell it today you would lose (0.51) from holding Advantage Solutions or give up 20.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Advantage Solutions vs. Sarama Resources
Performance |
| Timeline |
| Advantage Solutions |
| Sarama Resources |
Advantage Solutions and Sarama Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advantage Solutions and Sarama Resources
The main advantage of trading using opposite Advantage Solutions and Sarama Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advantage Solutions position performs unexpectedly, Sarama Resources 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 Sarama Resources will offset losses from the drop in Sarama Resources' long position.| Advantage Solutions vs. CannBioRx Life Sciences | Advantage Solutions vs. GCM Grosvenor | Advantage Solutions vs. CuriosityStream |
| Sarama Resources vs. Rupert Resources | Sarama Resources vs. Maritime Resources Corp | Sarama Resources vs. Abcourt Mines | Sarama Resources vs. Cerrado Gold |
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.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |