Correlation Between Steppe Gold and Fortuna Silver
Can any of the company-specific risk be diversified away by investing in both Steppe Gold and Fortuna 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 Steppe Gold and Fortuna Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steppe Gold and Fortuna Silver Mines, you can compare the effects of market volatilities on Steppe Gold and Fortuna 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 Steppe Gold with a short position of Fortuna Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steppe Gold and Fortuna Silver.
Diversification Opportunities for Steppe Gold and Fortuna Silver
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Steppe and Fortuna is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Steppe Gold and Fortuna Silver Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortuna Silver Mines and Steppe Gold 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 Steppe Gold are associated (or correlated) with Fortuna Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortuna Silver Mines has no effect on the direction of Steppe Gold i.e., Steppe Gold and Fortuna Silver go up and down completely randomly.
Pair Corralation between Steppe Gold and Fortuna Silver
Assuming the 90 days horizon Steppe Gold is expected to generate 1.25 times more return on investment than Fortuna Silver. However, Steppe Gold is 1.25 times more volatile than Fortuna Silver Mines. It trades about 0.02 of its potential returns per unit of risk. Fortuna Silver Mines is currently generating about -0.04 per unit of risk. If you would invest 45.00 in Steppe Gold on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Steppe Gold or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steppe Gold vs. Fortuna Silver Mines
Performance |
| Timeline |
| Steppe Gold |
| Fortuna Silver Mines |
Steppe Gold and Fortuna Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steppe Gold and Fortuna Silver
The main advantage of trading using opposite Steppe Gold and Fortuna Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steppe Gold position performs unexpectedly, Fortuna 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 Fortuna Silver will offset losses from the drop in Fortuna Silver's long position.| Steppe Gold vs. Maple Gold Mines | Steppe Gold vs. Caledonia Mining | Steppe Gold vs. Fortuna Silver Mines | Steppe Gold vs. Sandstorm Gold Ltd |
| Fortuna Silver vs. Fortitude Gold Corp | Fortuna Silver vs. New Gold | Fortuna Silver vs. Galiano Gold | Fortuna Silver vs. GoldMining |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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