Correlation Between Stillwater Critical and Scottie Resources
Can any of the company-specific risk be diversified away by investing in both Stillwater Critical and Scottie 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 Stillwater Critical and Scottie Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stillwater Critical Minerals and Scottie Resources Corp, you can compare the effects of market volatilities on Stillwater Critical and Scottie 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 Stillwater Critical with a short position of Scottie Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stillwater Critical and Scottie Resources.
Diversification Opportunities for Stillwater Critical and Scottie Resources
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Stillwater and Scottie is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Stillwater Critical Minerals and Scottie Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scottie Resources Corp and Stillwater Critical 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 Stillwater Critical Minerals are associated (or correlated) with Scottie Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scottie Resources Corp has no effect on the direction of Stillwater Critical i.e., Stillwater Critical and Scottie Resources go up and down completely randomly.
Pair Corralation between Stillwater Critical and Scottie Resources
Assuming the 90 days horizon Stillwater Critical Minerals is expected to under-perform the Scottie Resources. But the stock apears to be less risky and, when comparing its historical volatility, Stillwater Critical Minerals is 2.21 times less risky than Scottie Resources. The stock trades about -0.35 of its potential returns per unit of risk. The Scottie Resources Corp is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 90.00 in Scottie Resources Corp on September 22, 2024 and sell it today you would lose (8.00) from holding Scottie Resources Corp or give up 8.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stillwater Critical Minerals vs. Scottie Resources Corp
Performance |
| Timeline |
| Stillwater Critical |
| Scottie Resources Corp |
Stillwater Critical and Scottie Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stillwater Critical and Scottie Resources
The main advantage of trading using opposite Stillwater Critical and Scottie Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stillwater Critical position performs unexpectedly, Scottie 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 Scottie Resources will offset losses from the drop in Scottie Resources' long position.| Stillwater Critical vs. Grid Metals Corp | Stillwater Critical vs. Strikepoint Gold | Stillwater Critical vs. New Age Metals | Stillwater Critical vs. Grande Portage Resources |
| Scottie Resources vs. Strikepoint Gold | Scottie Resources vs. Eskay Mining Corp | Scottie Resources vs. Stillwater Critical Minerals |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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