Correlation Between Grid Metals and Sassy Resources
Can any of the company-specific risk be diversified away by investing in both Grid Metals and Sassy Resources 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 Grid Metals and Sassy Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grid Metals Corp and Sassy Resources, you can compare the effects of market volatilities on Grid Metals and Sassy Resources 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 Grid Metals with a short position of Sassy Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grid Metals and Sassy Resources.
Diversification Opportunities for Grid Metals and Sassy Resources
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Grid and Sassy is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Grid Metals Corp and Sassy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sassy Resources and Grid Metals 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 Grid Metals Corp are associated (or correlated) with Sassy Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sassy Resources has no effect on the direction of Grid Metals i.e., Grid Metals and Sassy Resources go up and down completely randomly.
Pair Corralation between Grid Metals and Sassy Resources
Assuming the 90 days horizon Grid Metals Corp is expected to under-perform the Sassy Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Grid Metals Corp is 3.4 times less risky than Sassy Resources. The otc stock trades about -0.04 of its potential returns per unit of risk. The Sassy Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 53.00 in Sassy Resources on September 3, 2024 and sell it today you would lose (47.03) from holding Sassy Resources or give up 88.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grid Metals Corp vs. Sassy Resources
Performance |
| Timeline |
| Grid Metals Corp |
| Sassy Resources |
Grid Metals and Sassy Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grid Metals and Sassy Resources
The main advantage of trading using opposite Grid Metals and Sassy Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grid Metals position performs unexpectedly, Sassy Resources 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 Sassy Resources will offset losses from the drop in Sassy Resources' long position.The idea behind Grid Metals Corp and Sassy Resources pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sassy Resources vs. Qubec Nickel Corp | Sassy Resources vs. IGO Limited | Sassy Resources vs. Avarone Metals | Sassy Resources vs. Adriatic Metals PLC |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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