Correlation Between Electrovaya Common and Sandstorm Gold
Can any of the company-specific risk be diversified away by investing in both Electrovaya Common 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 Electrovaya Common and Sandstorm Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electrovaya Common Shares and Sandstorm Gold Ltd, you can compare the effects of market volatilities on Electrovaya Common 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 Electrovaya Common with a short position of Sandstorm Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrovaya Common and Sandstorm Gold.
Diversification Opportunities for Electrovaya Common and Sandstorm Gold
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Electrovaya and Sandstorm is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Electrovaya Common Shares and Sandstorm Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sandstorm Gold and Electrovaya Common 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 Electrovaya Common Shares 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 Electrovaya Common i.e., Electrovaya Common and Sandstorm Gold go up and down completely randomly.
Pair Corralation between Electrovaya Common and Sandstorm Gold
Given the investment horizon of 90 days Electrovaya Common Shares is expected to under-perform the Sandstorm Gold. In addition to that, Electrovaya Common is 1.51 times more volatile than Sandstorm Gold Ltd. It trades about -0.01 of its total potential returns per unit of risk. Sandstorm Gold Ltd is currently generating about 0.02 per unit of volatility. If you would invest 565.00 in Sandstorm Gold Ltd on September 1, 2024 and sell it today you would earn a total of 14.00 from holding Sandstorm Gold Ltd or generate 2.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electrovaya Common Shares vs. Sandstorm Gold Ltd
Performance |
| Timeline |
| Electrovaya Common Shares |
| Sandstorm Gold |
Electrovaya Common and Sandstorm Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electrovaya Common and Sandstorm Gold
The main advantage of trading using opposite Electrovaya Common and Sandstorm Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrovaya Common 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.| Electrovaya Common vs. Bloom Energy Corp | Electrovaya Common vs. Microvast Holdings | Electrovaya Common vs. Solid Power | Electrovaya Common vs. FREYR Battery SA |
| 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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