Correlation Between Sandstorm Gold and Marine Products
Can any of the company-specific risk be diversified away by investing in both Sandstorm Gold and Marine Products 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 Marine Products 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 Marine Products, you can compare the effects of market volatilities on Sandstorm Gold and Marine Products 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 Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sandstorm Gold and Marine Products.
Diversification Opportunities for Sandstorm Gold and Marine Products
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sandstorm and Marine is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sandstorm Gold Ltd and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products 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 Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of Sandstorm Gold i.e., Sandstorm Gold and Marine Products go up and down completely randomly.
Pair Corralation between Sandstorm Gold and Marine Products
Given the investment horizon of 90 days Sandstorm Gold Ltd is expected to generate 1.29 times more return on investment than Marine Products. However, Sandstorm Gold is 1.29 times more volatile than Marine Products. It trades about 0.14 of its potential returns per unit of risk. Marine Products is currently generating about -0.05 per unit of risk. If you would invest 537.00 in Sandstorm Gold Ltd on September 14, 2024 and sell it today you would earn a total of 32.00 from holding Sandstorm Gold Ltd or generate 5.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sandstorm Gold Ltd vs. Marine Products
Performance |
| Timeline |
| Sandstorm Gold |
| Marine Products |
Sandstorm Gold and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sandstorm Gold and Marine Products
The main advantage of trading using opposite Sandstorm Gold and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sandstorm Gold position performs unexpectedly, Marine Products 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 Marine Products will offset losses from the drop in Marine Products' long position.| Sandstorm Gold vs. Fortitude Gold Corp | Sandstorm Gold vs. New Gold | Sandstorm Gold vs. Galiano Gold | Sandstorm Gold vs. GoldMining |
| Marine Products vs. Thor Industries | Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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