Correlation Between Alger Smallcap and Sitka Gold
Can any of the company-specific risk be diversified away by investing in both Alger Smallcap 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 Alger Smallcap and Sitka Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger Smallcap Growth and Sitka Gold Corp, you can compare the effects of market volatilities on Alger Smallcap 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 Alger Smallcap with a short position of Sitka Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Smallcap and Sitka Gold.
Diversification Opportunities for Alger Smallcap and Sitka Gold
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alger and Sitka is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Alger Smallcap Growth and Sitka Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sitka Gold Corp and Alger Smallcap 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 Alger Smallcap Growth 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 Corp has no effect on the direction of Alger Smallcap i.e., Alger Smallcap and Sitka Gold go up and down completely randomly.
Pair Corralation between Alger Smallcap and Sitka Gold
Assuming the 90 days horizon Alger Smallcap Growth is expected to generate 0.28 times more return on investment than Sitka Gold. However, Alger Smallcap Growth is 3.62 times less risky than Sitka Gold. It trades about 0.25 of its potential returns per unit of risk. Sitka Gold Corp is currently generating about -0.05 per unit of risk. If you would invest 1,033 in Alger Smallcap Growth on August 31, 2024 and sell it today you would earn a total of 93.00 from holding Alger Smallcap Growth or generate 9.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger Smallcap Growth vs. Sitka Gold Corp
Performance |
| Timeline |
| Alger Smallcap Growth |
| Sitka Gold Corp |
Alger Smallcap and Sitka Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Smallcap and Sitka Gold
The main advantage of trading using opposite Alger Smallcap and Sitka Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Smallcap 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.| Alger Smallcap vs. Aqr Large Cap | Alger Smallcap vs. Goldman Sachs Large | Alger Smallcap vs. T Rowe Price | Alger Smallcap vs. Pace Large Growth |
| Sitka Gold vs. Aurion Resources | Sitka Gold vs. Rio2 Limited | Sitka Gold vs. Palamina Corp | Sitka Gold vs. BTU Metals Corp |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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