Correlation Between Exchange Income and Sandstorm Gold
Can any of the company-specific risk be diversified away by investing in both Exchange Income 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 Exchange Income and Sandstorm Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exchange Income and Sandstorm Gold Ltd, you can compare the effects of market volatilities on Exchange Income 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 Exchange Income with a short position of Sandstorm Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exchange Income and Sandstorm Gold.
Diversification Opportunities for Exchange Income and Sandstorm Gold
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Exchange and Sandstorm is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Exchange Income and Sandstorm Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sandstorm Gold and Exchange Income 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 Exchange Income 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 Exchange Income i.e., Exchange Income and Sandstorm Gold go up and down completely randomly.
Pair Corralation between Exchange Income and Sandstorm Gold
Assuming the 90 days trading horizon Exchange Income is expected to generate 2.36 times less return on investment than Sandstorm Gold. But when comparing it to its historical volatility, Exchange Income is 1.7 times less risky than Sandstorm Gold. It trades about 0.03 of its potential returns per unit of risk. Sandstorm Gold Ltd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 598.00 in Sandstorm Gold Ltd on November 2, 2024 and sell it today you would earn a total of 262.00 from holding Sandstorm Gold Ltd or generate 43.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exchange Income vs. Sandstorm Gold Ltd
Performance |
| Timeline |
| Exchange Income |
| Sandstorm Gold |
Exchange Income and Sandstorm Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exchange Income and Sandstorm Gold
The main advantage of trading using opposite Exchange Income and Sandstorm Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exchange Income 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.| Exchange Income vs. Capital Power | Exchange Income vs. Keyera Corp | Exchange Income vs. Parkland Fuel | Exchange Income vs. TFI International |
| Sandstorm Gold vs. Osisko Gold Ro | Sandstorm Gold vs. Wheaton Precious Metals | Sandstorm Gold vs. Seabridge Gold | Sandstorm Gold vs. MAG Silver 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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