Correlation Between HF SINCLAIR and Providence Gold
Can any of the company-specific risk be diversified away by investing in both HF SINCLAIR and Providence 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 HF SINCLAIR and Providence Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF SINCLAIR P and Providence Gold Mines, you can compare the effects of market volatilities on HF SINCLAIR and Providence 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 HF SINCLAIR with a short position of Providence Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF SINCLAIR and Providence Gold.
Diversification Opportunities for HF SINCLAIR and Providence Gold
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HL80 and Providence is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding HF SINCLAIR P and Providence Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Providence Gold Mines and HF SINCLAIR 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 HF SINCLAIR P are associated (or correlated) with Providence Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Providence Gold Mines has no effect on the direction of HF SINCLAIR i.e., HF SINCLAIR and Providence Gold go up and down completely randomly.
Pair Corralation between HF SINCLAIR and Providence Gold
Assuming the 90 days trading horizon HF SINCLAIR P is expected to under-perform the Providence Gold. But the stock apears to be less risky and, when comparing its historical volatility, HF SINCLAIR P is 20.36 times less risky than Providence Gold. The stock trades about -0.06 of its potential returns per unit of risk. The Providence Gold Mines is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 0.75 in Providence Gold Mines on September 12, 2024 and sell it today you would earn a total of 1.20 from holding Providence Gold Mines or generate 160.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
HF SINCLAIR P vs. Providence Gold Mines
Performance |
| Timeline |
| HF SINCLAIR P |
| Providence Gold Mines |
HF SINCLAIR and Providence Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF SINCLAIR and Providence Gold
The main advantage of trading using opposite HF SINCLAIR and Providence Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF SINCLAIR position performs unexpectedly, Providence 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 Providence Gold will offset losses from the drop in Providence Gold's long position.| HF SINCLAIR vs. Superior Plus Corp | HF SINCLAIR vs. SIVERS SEMICONDUCTORS AB | HF SINCLAIR vs. Norsk Hydro ASA | HF SINCLAIR vs. Reliance Steel Aluminum |
| Providence Gold vs. STORE ELECTRONIC | Providence Gold vs. Waste Management | Providence Gold vs. Methode Electronics | Providence Gold vs. CEOTRONICS |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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