Correlation Between Sandstorm Gold and Aurion Resources
Can any of the company-specific risk be diversified away by investing in both Sandstorm Gold and Aurion 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 Sandstorm Gold and Aurion Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sandstorm Gold Ltd and Aurion Resources, you can compare the effects of market volatilities on Sandstorm Gold and Aurion 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 Sandstorm Gold with a short position of Aurion Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sandstorm Gold and Aurion Resources.
Diversification Opportunities for Sandstorm Gold and Aurion Resources
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sandstorm and Aurion is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sandstorm Gold Ltd and Aurion Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurion Resources and Sandstorm Gold 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 Sandstorm Gold Ltd are associated (or correlated) with Aurion Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurion Resources has no effect on the direction of Sandstorm Gold i.e., Sandstorm Gold and Aurion Resources go up and down completely randomly.
Pair Corralation between Sandstorm Gold and Aurion Resources
Given the investment horizon of 90 days Sandstorm Gold Ltd is expected to generate 0.77 times more return on investment than Aurion Resources. However, Sandstorm Gold Ltd is 1.3 times less risky than Aurion Resources. It trades about -0.11 of its potential returns per unit of risk. Aurion Resources is currently generating about -0.23 per unit of risk. If you would invest 630.00 in Sandstorm Gold Ltd on August 25, 2024 and sell it today you would lose (45.00) from holding Sandstorm Gold Ltd or give up 7.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sandstorm Gold Ltd vs. Aurion Resources
Performance |
| Timeline |
| Sandstorm Gold |
| Aurion Resources |
Sandstorm Gold and Aurion Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sandstorm Gold and Aurion Resources
The main advantage of trading using opposite Sandstorm Gold and Aurion Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sandstorm Gold position performs unexpectedly, Aurion 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 Aurion Resources will offset losses from the drop in Aurion Resources' long position.| Sandstorm Gold vs. Franco Nevada | Sandstorm Gold vs. Royal Gold | Sandstorm Gold vs. Alamos Gold | Sandstorm Gold vs. Seabridge Gold |
| Aurion Resources vs. Ascendant Resources | Aurion Resources vs. Cantex Mine Development | Aurion Resources vs. Amarc Resources | Aurion Resources vs. Sterling Metals Corp |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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