Correlation Between SPC Nickel and Canada Silver
Can any of the company-specific risk be diversified away by investing in both SPC Nickel and Canada 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 SPC Nickel and Canada Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPC Nickel Corp and Canada Silver Cobalt, you can compare the effects of market volatilities on SPC Nickel and Canada 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 SPC Nickel with a short position of Canada Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPC Nickel and Canada Silver.
Diversification Opportunities for SPC Nickel and Canada Silver
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPC and Canada is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding SPC Nickel Corp and Canada Silver Cobalt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canada Silver Cobalt and SPC Nickel 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 SPC Nickel Corp are associated (or correlated) with Canada Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canada Silver Cobalt has no effect on the direction of SPC Nickel i.e., SPC Nickel and Canada Silver go up and down completely randomly.
Pair Corralation between SPC Nickel and Canada Silver
Assuming the 90 days horizon SPC Nickel is expected to generate 17.19 times less return on investment than Canada Silver. But when comparing it to its historical volatility, SPC Nickel Corp is 6.6 times less risky than Canada Silver. It trades about 0.04 of its potential returns per unit of risk. Canada Silver Cobalt is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 25.00 in Canada Silver Cobalt on August 25, 2024 and sell it today you would lose (15.00) from holding Canada Silver Cobalt or give up 60.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPC Nickel Corp vs. Canada Silver Cobalt
Performance |
| Timeline |
| SPC Nickel Corp |
| Canada Silver Cobalt |
SPC Nickel and Canada Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPC Nickel and Canada Silver
The main advantage of trading using opposite SPC Nickel and Canada Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPC Nickel position performs unexpectedly, Canada 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 Canada Silver will offset losses from the drop in Canada Silver's long position.| SPC Nickel vs. Norra Metals Corp | SPC Nickel vs. ZincX Resources Corp | SPC Nickel vs. Nuinsco Resources Limited | SPC Nickel vs. South Star Battery |
| Canada Silver vs. Ascendant Resources | Canada Silver vs. Cantex Mine Development | Canada Silver vs. Amarc Resources | Canada Silver 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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