Correlation Between United States and Sun Summit
Can any of the company-specific risk be diversified away by investing in both United States and Sun Summit 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 United States and Sun Summit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United States Antimony and Sun Summit Minerals, you can compare the effects of market volatilities on United States and Sun Summit 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 United States with a short position of Sun Summit. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and Sun Summit.
Diversification Opportunities for United States and Sun Summit
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and Sun is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding United States Antimony and Sun Summit Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Summit Minerals and United States 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 United States Antimony are associated (or correlated) with Sun Summit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Summit Minerals has no effect on the direction of United States i.e., United States and Sun Summit go up and down completely randomly.
Pair Corralation between United States and Sun Summit
Given the investment horizon of 90 days United States Antimony is expected to generate 0.68 times more return on investment than Sun Summit. However, United States Antimony is 1.47 times less risky than Sun Summit. It trades about 0.13 of its potential returns per unit of risk. Sun Summit Minerals is currently generating about -0.02 per unit of risk. If you would invest 34.00 in United States Antimony on September 1, 2024 and sell it today you would earn a total of 42.00 from holding United States Antimony or generate 123.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United States Antimony vs. Sun Summit Minerals
Performance |
| Timeline |
| United States Antimony |
| Sun Summit Minerals |
United States and Sun Summit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United States and Sun Summit
The main advantage of trading using opposite United States and Sun Summit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, Sun Summit 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 Sun Summit will offset losses from the drop in Sun Summit's long position.| United States vs. Syrah Resources Limited | United States vs. Nouveau Monde Graphite | United States vs. Trilogy Metals | United States vs. Global Atomic Corp |
| Sun Summit vs. South32 Limited | Sun Summit vs. NioCorp Developments Ltd | Sun Summit vs. HUMANA INC | Sun Summit vs. SCOR PK |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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