Correlation Between Sandfire Resources and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Sandfire Resources and Superior Plus 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 Sandfire Resources and Superior Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sandfire Resources Limited and Superior Plus Corp, you can compare the effects of market volatilities on Sandfire Resources and Superior Plus 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 Sandfire Resources with a short position of Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sandfire Resources and Superior Plus.
Diversification Opportunities for Sandfire Resources and Superior Plus
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sandfire and Superior is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sandfire Resources Limited and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp and Sandfire Resources 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 Sandfire Resources Limited are associated (or correlated) with Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Sandfire Resources i.e., Sandfire Resources and Superior Plus go up and down completely randomly.
Pair Corralation between Sandfire Resources and Superior Plus
Assuming the 90 days horizon Sandfire Resources Limited is expected to generate 1.18 times more return on investment than Superior Plus. However, Sandfire Resources is 1.18 times more volatile than Superior Plus Corp. It trades about 0.06 of its potential returns per unit of risk. Superior Plus Corp is currently generating about -0.02 per unit of risk. If you would invest 337.00 in Sandfire Resources Limited on September 13, 2024 and sell it today you would earn a total of 308.00 from holding Sandfire Resources Limited or generate 91.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sandfire Resources Limited vs. Superior Plus Corp
Performance |
| Timeline |
| Sandfire Resources |
| Superior Plus Corp |
Sandfire Resources and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sandfire Resources and Superior Plus
The main advantage of trading using opposite Sandfire Resources and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sandfire Resources position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Sandfire Resources vs. Tsingtao Brewery | Sandfire Resources vs. Sixt Leasing SE | Sandfire Resources vs. LANDSEA HOMES P | Sandfire Resources vs. Lendlease Group |
| Superior Plus vs. HF SINCLAIR P | Superior Plus vs. PT Indofood Sukses | Superior Plus vs. SENECA FOODS A | Superior Plus vs. ScanSource |
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 CEOs Directory module to screen CEOs from public companies around the world.
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