Correlation Between Silver Spike and Maple Leaf
Can any of the company-specific risk be diversified away by investing in both Silver Spike and Maple Leaf 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 Silver Spike and Maple Leaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silver Spike Investment and Maple Leaf Green, you can compare the effects of market volatilities on Silver Spike and Maple Leaf 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 Silver Spike with a short position of Maple Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silver Spike and Maple Leaf.
Diversification Opportunities for Silver Spike and Maple Leaf
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Silver and Maple is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Silver Spike Investment and Maple Leaf Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Leaf Green and Silver Spike 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 Silver Spike Investment are associated (or correlated) with Maple Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Leaf Green has no effect on the direction of Silver Spike i.e., Silver Spike and Maple Leaf go up and down completely randomly.
Pair Corralation between Silver Spike and Maple Leaf
Given the investment horizon of 90 days Silver Spike is expected to generate 8.42 times less return on investment than Maple Leaf. But when comparing it to its historical volatility, Silver Spike Investment is 11.44 times less risky than Maple Leaf. It trades about 0.12 of its potential returns per unit of risk. Maple Leaf Green is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2.40 in Maple Leaf Green on August 31, 2024 and sell it today you would earn a total of 0.80 from holding Maple Leaf Green or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 92.51% |
| Values | Daily Returns |
Silver Spike Investment vs. Maple Leaf Green
Performance |
| Timeline |
| Silver Spike Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| Maple Leaf Green |
Silver Spike and Maple Leaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silver Spike and Maple Leaf
The main advantage of trading using opposite Silver Spike and Maple Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silver Spike position performs unexpectedly, Maple Leaf 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 Maple Leaf will offset losses from the drop in Maple Leaf's long position.| Silver Spike vs. Entourage Health Corp | Silver Spike vs. Avicanna | Silver Spike vs. Benchmark Botanics | Silver Spike vs. Speakeasy Cannabis Club |
| Maple Leaf vs. Brainsway | Maple Leaf vs. Venus Concept | Maple Leaf vs. Tactile Systems Technology | Maple Leaf vs. Icecure Medical |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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