Correlation Between AMCON Distributing and Sandstorm Gold
Can any of the company-specific risk be diversified away by investing in both AMCON Distributing and Sandstorm 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 AMCON Distributing and Sandstorm Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMCON Distributing and Sandstorm Gold Ltd, you can compare the effects of market volatilities on AMCON Distributing and Sandstorm 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 AMCON Distributing with a short position of Sandstorm Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMCON Distributing and Sandstorm Gold.
Diversification Opportunities for AMCON Distributing and Sandstorm Gold
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AMCON and Sandstorm is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding AMCON Distributing and Sandstorm Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sandstorm Gold and AMCON Distributing 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 AMCON Distributing are associated (or correlated) with Sandstorm Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sandstorm Gold has no effect on the direction of AMCON Distributing i.e., AMCON Distributing and Sandstorm Gold go up and down completely randomly.
Pair Corralation between AMCON Distributing and Sandstorm Gold
Considering the 90-day investment horizon AMCON Distributing is expected to generate 1.3 times less return on investment than Sandstorm Gold. In addition to that, AMCON Distributing is 1.93 times more volatile than Sandstorm Gold Ltd. It trades about 0.06 of its total potential returns per unit of risk. Sandstorm Gold Ltd is currently generating about 0.14 per unit of volatility. If you would invest 537.00 in Sandstorm Gold Ltd on September 14, 2024 and sell it today you would earn a total of 32.00 from holding Sandstorm Gold Ltd or generate 5.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMCON Distributing vs. Sandstorm Gold Ltd
Performance |
| Timeline |
| AMCON Distributing |
| Sandstorm Gold |
AMCON Distributing and Sandstorm Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMCON Distributing and Sandstorm Gold
The main advantage of trading using opposite AMCON Distributing and Sandstorm Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMCON Distributing position performs unexpectedly, Sandstorm 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 Sandstorm Gold will offset losses from the drop in Sandstorm Gold's long position.| AMCON Distributing vs. Steven Madden | AMCON Distributing vs. Vera Bradley | AMCON Distributing vs. Caleres | AMCON Distributing vs. Wolverine World Wide |
| Sandstorm Gold vs. Fortitude Gold Corp | Sandstorm Gold vs. New Gold | Sandstorm Gold vs. Galiano Gold | Sandstorm Gold vs. GoldMining |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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