Correlation Between Ecovyst and Sibanye Gold
Can any of the company-specific risk be diversified away by investing in both Ecovyst and Sibanye 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 Ecovyst and Sibanye Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecovyst and Sibanye Gold Ltd, you can compare the effects of market volatilities on Ecovyst and Sibanye 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 Ecovyst with a short position of Sibanye Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecovyst and Sibanye Gold.
Diversification Opportunities for Ecovyst and Sibanye Gold
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ecovyst and Sibanye is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst and Sibanye Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye Gold and Ecovyst 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 Ecovyst are associated (or correlated) with Sibanye Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Gold has no effect on the direction of Ecovyst i.e., Ecovyst and Sibanye Gold go up and down completely randomly.
Pair Corralation between Ecovyst and Sibanye Gold
Given the investment horizon of 90 days Ecovyst is expected to generate 1.89 times less return on investment than Sibanye Gold. But when comparing it to its historical volatility, Ecovyst is 2.06 times less risky than Sibanye Gold. It trades about 0.06 of its potential returns per unit of risk. Sibanye Gold Ltd is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 347.00 in Sibanye Gold Ltd on November 2, 2024 and sell it today you would earn a total of 7.00 from holding Sibanye Gold Ltd or generate 2.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecovyst vs. Sibanye Gold Ltd
Performance |
| Timeline |
| Ecovyst |
| Sibanye Gold |
Ecovyst and Sibanye Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecovyst and Sibanye Gold
The main advantage of trading using opposite Ecovyst and Sibanye Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecovyst position performs unexpectedly, Sibanye 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 Sibanye Gold will offset losses from the drop in Sibanye Gold's long position.| Ecovyst vs. Orion Engineered Carbons | Ecovyst vs. Cabot | Ecovyst vs. Minerals Technologies | Ecovyst vs. Quaker Chemical |
| Sibanye Gold vs. AngloGold Ashanti plc | Sibanye Gold vs. Harmony Gold Mining | Sibanye Gold vs. Eldorado Gold Corp | Sibanye Gold vs. Kinross 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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