Correlation Between Sprott Junior and IShares Silver
Can any of the company-specific risk be diversified away by investing in both Sprott Junior and IShares Silver 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 Sprott Junior and IShares Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Junior Gold and iShares Silver Trust, you can compare the effects of market volatilities on Sprott Junior and IShares Silver 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 Sprott Junior with a short position of IShares Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Junior and IShares Silver.
Diversification Opportunities for Sprott Junior and IShares Silver
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sprott and IShares is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Junior Gold and iShares Silver Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Silver Trust and Sprott Junior 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 Sprott Junior Gold are associated (or correlated) with IShares Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Silver Trust has no effect on the direction of Sprott Junior i.e., Sprott Junior and IShares Silver go up and down completely randomly.
Pair Corralation between Sprott Junior and IShares Silver
Given the investment horizon of 90 days Sprott Junior Gold is expected to generate 1.07 times more return on investment than IShares Silver. However, Sprott Junior is 1.07 times more volatile than iShares Silver Trust. It trades about 0.05 of its potential returns per unit of risk. iShares Silver Trust is currently generating about 0.0 per unit of risk. If you would invest 3,417 in Sprott Junior Gold on August 27, 2024 and sell it today you would earn a total of 369.00 from holding Sprott Junior Gold or generate 10.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sprott Junior Gold vs. iShares Silver Trust
Performance |
| Timeline |
| Sprott Junior Gold |
| iShares Silver Trust |
Sprott Junior and IShares Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Junior and IShares Silver
The main advantage of trading using opposite Sprott Junior and IShares Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Junior position performs unexpectedly, IShares Silver 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 IShares Silver will offset losses from the drop in IShares Silver's long position.| Sprott Junior vs. Sprott Gold Miners | Sprott Junior vs. Amplify ETF Trust | Sprott Junior vs. US Global GO | Sprott Junior vs. Global X Gold |
| IShares Silver vs. SPDR Gold Shares | IShares Silver vs. VanEck Gold Miners | IShares Silver vs. United States Oil | IShares Silver vs. iShares Gold Trust |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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