Correlation Between Sassy Resources and Benton Resources
Can any of the company-specific risk be diversified away by investing in both Sassy Resources and Benton Resources 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 Sassy Resources and Benton Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sassy Resources and Benton Resources, you can compare the effects of market volatilities on Sassy Resources and Benton Resources 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 Sassy Resources with a short position of Benton Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sassy Resources and Benton Resources.
Diversification Opportunities for Sassy Resources and Benton Resources
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sassy and Benton is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Sassy Resources and Benton Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benton Resources and Sassy Resources 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 Sassy Resources are associated (or correlated) with Benton Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benton Resources has no effect on the direction of Sassy Resources i.e., Sassy Resources and Benton Resources go up and down completely randomly.
Pair Corralation between Sassy Resources and Benton Resources
Assuming the 90 days horizon Sassy Resources is expected to under-perform the Benton Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Sassy Resources is 2.95 times less risky than Benton Resources. The otc stock trades about -0.27 of its potential returns per unit of risk. The Benton Resources is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 8.00 in Benton Resources on September 3, 2024 and sell it today you would lose (3.00) from holding Benton Resources or give up 37.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Sassy Resources vs. Benton Resources
Performance |
| Timeline |
| Sassy Resources |
| Benton Resources |
Sassy Resources and Benton Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sassy Resources and Benton Resources
The main advantage of trading using opposite Sassy Resources and Benton Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sassy Resources position performs unexpectedly, Benton Resources 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 Benton Resources will offset losses from the drop in Benton Resources' long position.| Sassy Resources vs. Qubec Nickel Corp | Sassy Resources vs. IGO Limited | Sassy Resources vs. Avarone Metals | Sassy Resources vs. Adriatic Metals PLC |
| Benton Resources vs. Aurelia Metals Limited | Benton Resources vs. Artemis Resources | Benton Resources vs. Ascendant Resources | Benton Resources vs. Altiplano Metals |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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