Correlation Between Sun Summit and Excelsior Mining
Can any of the company-specific risk be diversified away by investing in both Sun Summit and Excelsior Mining 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 Sun Summit and Excelsior Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Summit Minerals and Excelsior Mining Corp, you can compare the effects of market volatilities on Sun Summit and Excelsior Mining 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 Sun Summit with a short position of Excelsior Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Summit and Excelsior Mining.
Diversification Opportunities for Sun Summit and Excelsior Mining
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sun and Excelsior is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Sun Summit Minerals and Excelsior Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excelsior Mining Corp and Sun Summit 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 Sun Summit Minerals are associated (or correlated) with Excelsior Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excelsior Mining Corp has no effect on the direction of Sun Summit i.e., Sun Summit and Excelsior Mining go up and down completely randomly.
Pair Corralation between Sun Summit and Excelsior Mining
Assuming the 90 days horizon Sun Summit Minerals is expected to generate 1.57 times more return on investment than Excelsior Mining. However, Sun Summit is 1.57 times more volatile than Excelsior Mining Corp. It trades about 0.02 of its potential returns per unit of risk. Excelsior Mining Corp is currently generating about 0.03 per unit of risk. If you would invest 39.00 in Sun Summit Minerals on August 30, 2024 and sell it today you would lose (27.00) from holding Sun Summit Minerals or give up 69.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Summit Minerals vs. Excelsior Mining Corp
Performance |
| Timeline |
| Sun Summit Minerals |
| Excelsior Mining Corp |
Sun Summit and Excelsior Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Summit and Excelsior Mining
The main advantage of trading using opposite Sun Summit and Excelsior Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Summit position performs unexpectedly, Excelsior Mining 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 Excelsior Mining will offset losses from the drop in Excelsior Mining's long position.| Sun Summit vs. First Majestic Silver | Sun Summit vs. Ivanhoe Energy | Sun Summit vs. Orezone Gold Corp | Sun Summit vs. Faraday Copper Corp |
| Excelsior Mining vs. RTG Mining | Excelsior Mining vs. Nubian Resources | Excelsior Mining vs. Fremont Gold | Excelsior Mining vs. Royal Road Minerals |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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