Correlation Between Sprott Physical and CI Financial
Can any of the company-specific risk be diversified away by investing in both Sprott Physical and CI Financial 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 Sprott Physical and CI Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Physical Gold and CI Financial Corp, you can compare the effects of market volatilities on Sprott Physical and CI Financial 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 Sprott Physical with a short position of CI Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Physical and CI Financial.
Diversification Opportunities for Sprott Physical and CI Financial
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sprott and CIX is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Physical Gold and CI Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Financial Corp and Sprott Physical 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 Sprott Physical Gold are associated (or correlated) with CI Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Financial Corp has no effect on the direction of Sprott Physical i.e., Sprott Physical and CI Financial go up and down completely randomly.
Pair Corralation between Sprott Physical and CI Financial
Assuming the 90 days trading horizon Sprott Physical is expected to generate 3.63 times less return on investment than CI Financial. But when comparing it to its historical volatility, Sprott Physical Gold is 2.17 times less risky than CI Financial. It trades about 0.07 of its potential returns per unit of risk. CI Financial Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 910.00 in CI Financial Corp on September 14, 2024 and sell it today you would earn a total of 2,192 from holding CI Financial Corp or generate 240.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sprott Physical Gold vs. CI Financial Corp
Performance |
| Timeline |
| Sprott Physical Gold |
| CI Financial Corp |
Sprott Physical and CI Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Physical and CI Financial
The main advantage of trading using opposite Sprott Physical and CI Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Physical position performs unexpectedly, CI Financial 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 CI Financial will offset losses from the drop in CI Financial's long position.| Sprott Physical vs. CI Financial Corp | Sprott Physical vs. Canso Credit Trust | Sprott Physical vs. Canadian Imperial Bank | Sprott Physical vs. National Bank of |
| CI Financial vs. Berkshire Hathaway CDR | CI Financial vs. E L Financial Corp | CI Financial vs. E L Financial 3 | CI Financial vs. Molson Coors Canada |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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