Correlation Between Summa Silver and Stamper Oil
Can any of the company-specific risk be diversified away by investing in both Summa Silver and Stamper Oil 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 Summa Silver and Stamper Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summa Silver Corp and Stamper Oil Gas, you can compare the effects of market volatilities on Summa Silver and Stamper Oil 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 Summa Silver with a short position of Stamper Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summa Silver and Stamper Oil.
Diversification Opportunities for Summa Silver and Stamper Oil
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Summa and Stamper is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Summa Silver Corp and Stamper Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stamper Oil Gas and Summa Silver 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 Summa Silver Corp are associated (or correlated) with Stamper Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stamper Oil Gas has no effect on the direction of Summa Silver i.e., Summa Silver and Stamper Oil go up and down completely randomly.
Pair Corralation between Summa Silver and Stamper Oil
Assuming the 90 days trading horizon Summa Silver Corp is expected to under-perform the Stamper Oil. But the stock apears to be less risky and, when comparing its historical volatility, Summa Silver Corp is 7.75 times less risky than Stamper Oil. The stock trades about -0.22 of its potential returns per unit of risk. The Stamper Oil Gas is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Stamper Oil Gas on September 5, 2024 and sell it today you would earn a total of 0.50 from holding Stamper Oil Gas or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Summa Silver Corp vs. Stamper Oil Gas
Performance |
| Timeline |
| Summa Silver Corp |
| Stamper Oil Gas |
Summa Silver and Stamper Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summa Silver and Stamper Oil
The main advantage of trading using opposite Summa Silver and Stamper Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summa Silver position performs unexpectedly, Stamper Oil 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 Stamper Oil will offset losses from the drop in Stamper Oil's long position.| Summa Silver vs. Guanajuato Silver | Summa Silver vs. AbraSilver Resource Corp | Summa Silver vs. Blackrock Silver Corp | Summa Silver vs. Silver Viper Minerals |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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