Correlation Between Santacruz Silver and NTT DATA

Can any of the company-specific risk be diversified away by investing in both Santacruz Silver and NTT DATA 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 Santacruz Silver and NTT DATA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Santacruz Silver Mining and NTT DATA , you can compare the effects of market volatilities on Santacruz Silver and NTT DATA 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 Santacruz Silver with a short position of NTT DATA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Santacruz Silver and NTT DATA.

Diversification Opportunities for Santacruz Silver and NTT DATA

-0.8

Correlation Coefficient

Santacruz Silver  NTT DATA

Pay attention - limited upside

The 3 months correlation between Santacruz and NTT is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Santacruz Silver Mining and NTT DATA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NTT DATA and Santacruz 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 Santacruz Silver Mining are associated (or correlated) with NTT DATA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NTT DATA has no effect on the direction of Santacruz Silver i.e., Santacruz Silver and NTT DATA go up and down completely randomly.

Pair Corralation between Santacruz Silver and NTT DATA

Assuming the 90 days horizon Santacruz Silver Mining is expected to generate 4.25 times more return on investment than NTT DATA. However, Santacruz Silver is 4.25 times more volatile than NTT DATA . It trades about 0.04 of its potential returns per unit of risk. NTT DATA is currently generating about 0.04 per unit of risk. If you would invest  26.00  in Santacruz Silver Mining on October 26, 2024 and sell it today you would lose (5.00) from holding Santacruz Silver Mining or give up 19.23% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Santacruz Silver Mining  vs.  NTT DATA

Santacruz Silver Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Santacruz Silver Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

NTT DATA

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NTT DATA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, NTT DATA unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Santacruz Silver and NTT DATA

The main advantage of trading using opposite Santacruz Silver and NTT DATA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Santacruz Silver position performs unexpectedly, NTT DATA 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 NTT DATA will offset losses from the drop in NTT DATA's long position.

The idea behind Santacruz Silver Mining and NTT DATA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.