Correlation Between Townsquare Media and Sandstorm Gold
Can any of the company-specific risk be diversified away by investing in both Townsquare Media and Sandstorm Gold 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 Townsquare Media and Sandstorm Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Townsquare Media and Sandstorm Gold Ltd, you can compare the effects of market volatilities on Townsquare Media and Sandstorm Gold 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 Townsquare Media with a short position of Sandstorm Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Townsquare Media and Sandstorm Gold.
Diversification Opportunities for Townsquare Media and Sandstorm Gold
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Townsquare and Sandstorm is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Townsquare Media and Sandstorm Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sandstorm Gold and Townsquare Media 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 Townsquare Media are associated (or correlated) with Sandstorm Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sandstorm Gold has no effect on the direction of Townsquare Media i.e., Townsquare Media and Sandstorm Gold go up and down completely randomly.
Pair Corralation between Townsquare Media and Sandstorm Gold
Considering the 90-day investment horizon Townsquare Media is expected to generate 0.62 times more return on investment than Sandstorm Gold. However, Townsquare Media is 1.61 times less risky than Sandstorm Gold. It trades about 0.11 of its potential returns per unit of risk. Sandstorm Gold Ltd is currently generating about -0.1 per unit of risk. If you would invest 974.00 in Townsquare Media on September 3, 2024 and sell it today you would earn a total of 36.00 from holding Townsquare Media or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Townsquare Media vs. Sandstorm Gold Ltd
Performance |
| Timeline |
| Townsquare Media |
| Sandstorm Gold |
Townsquare Media and Sandstorm Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Townsquare Media and Sandstorm Gold
The main advantage of trading using opposite Townsquare Media and Sandstorm Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Townsquare Media position performs unexpectedly, Sandstorm Gold 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 Sandstorm Gold will offset losses from the drop in Sandstorm Gold's long position.| Townsquare Media vs. Mirriad Advertising plc | Townsquare Media vs. INEO Tech Corp | Townsquare Media vs. Kidoz Inc | Townsquare Media vs. Marchex |
| Sandstorm Gold vs. Franco Nevada | Sandstorm Gold vs. Royal Gold | Sandstorm Gold vs. Alamos Gold | Sandstorm Gold vs. Seabridge Gold |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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