Correlation Between Eastwood Bio and Sprott

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

By analyzing existing cross correlation between Eastwood Bio Medical Canada and Sprott Inc, you can compare the effects of market volatilities on Eastwood Bio and Sprott 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 Eastwood Bio with a short position of Sprott. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastwood Bio and Sprott.

Diversification Opportunities for Eastwood Bio and Sprott

-0.53

Correlation Coefficient

Eastwood Bio  Sprott

Excellent diversification

The 3 months correlation between Eastwood and Sprott is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Eastwood Bio Medical Canada and Sprott Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Inc and Eastwood Bio 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 Eastwood Bio Medical Canada are associated (or correlated) with Sprott. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Inc has no effect on the direction of Eastwood Bio i.e., Eastwood Bio and Sprott go up and down completely randomly.

Pair Corralation between Eastwood Bio and Sprott

Assuming the 90 days horizon Eastwood Bio Medical Canada is expected to under-perform the Sprott. In addition to that, Eastwood Bio is 5.7 times more volatile than Sprott Inc. It trades about -0.06 of its total potential returns per unit of risk. Sprott Inc is currently generating about 0.07 per unit of volatility. If you would invest  5,896  in Sprott Inc on December 30, 2024 and sell it today you would earn a total of  443.00  from holding Sprott Inc or generate 7.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Eastwood Bio Medical Canada  vs.  Sprott Inc

Eastwood Bio Medical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eastwood Bio Medical Canada has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Sprott Inc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Sprott may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Eastwood Bio and Sprott

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

The idea behind Eastwood Bio Medical Canada and Sprott Inc 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.

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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.