Correlation Between Sandstorm Gold and Parker Hannifin
Can any of the company-specific risk be diversified away by investing in both Sandstorm Gold and Parker Hannifin 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 Parker Hannifin 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 Parker Hannifin, you can compare the effects of market volatilities on Sandstorm Gold and Parker Hannifin 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 Parker Hannifin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sandstorm Gold and Parker Hannifin.
Diversification Opportunities for Sandstorm Gold and Parker Hannifin
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sandstorm and Parker is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Sandstorm Gold Ltd and Parker Hannifin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parker Hannifin 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 Parker Hannifin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parker Hannifin has no effect on the direction of Sandstorm Gold i.e., Sandstorm Gold and Parker Hannifin go up and down completely randomly.
Pair Corralation between Sandstorm Gold and Parker Hannifin
Given the investment horizon of 90 days Sandstorm Gold Ltd is expected to under-perform the Parker Hannifin. In addition to that, Sandstorm Gold is 1.29 times more volatile than Parker Hannifin. It trades about -0.05 of its total potential returns per unit of risk. Parker Hannifin is currently generating about 0.26 per unit of volatility. If you would invest 62,281 in Parker Hannifin on August 31, 2024 and sell it today you would earn a total of 7,707 from holding Parker Hannifin or generate 12.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sandstorm Gold Ltd vs. Parker Hannifin
Performance |
| Timeline |
| Sandstorm Gold |
| Parker Hannifin |
Sandstorm Gold and Parker Hannifin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sandstorm Gold and Parker Hannifin
The main advantage of trading using opposite Sandstorm Gold and Parker Hannifin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sandstorm Gold position performs unexpectedly, Parker Hannifin 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 Parker Hannifin will offset losses from the drop in Parker Hannifin's long position.| Sandstorm Gold vs. Franco Nevada | Sandstorm Gold vs. Alamos Gold | Sandstorm Gold vs. Seabridge Gold | Sandstorm Gold vs. Osisko Gold Ro |
| Parker Hannifin vs. Standex International | Parker Hannifin vs. Donaldson | Parker Hannifin vs. CSW Industrials | Parker Hannifin vs. Franklin Electric Co |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |