Correlation Between JSC National and Sprott Physical

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

By analyzing existing cross correlation between JSC National Atomic and Sprott Physical Uranium, you can compare the effects of market volatilities on JSC National and Sprott Physical 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 JSC National with a short position of Sprott Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of JSC National and Sprott Physical.

Diversification Opportunities for JSC National and Sprott Physical

-0.08

Correlation Coefficient

JSC National  Sprott Physical

Good diversification

The 3 months correlation between JSC and Sprott is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding JSC National Atomic and Sprott Physical Uranium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Physical Uranium and JSC National 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 JSC National Atomic are associated (or correlated) with Sprott Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Physical Uranium has no effect on the direction of JSC National i.e., JSC National and Sprott Physical go up and down completely randomly.

Pair Corralation between JSC National and Sprott Physical

Assuming the 90 days trading horizon JSC National Atomic is expected to generate 0.66 times more return on investment than Sprott Physical. However, JSC National Atomic is 1.51 times less risky than Sprott Physical. It trades about -0.2 of its potential returns per unit of risk. Sprott Physical Uranium is currently generating about -0.26 per unit of risk. If you would invest  4,065  in JSC National Atomic on September 21, 2024 and sell it today you would lose (225.00) from holding JSC National Atomic or give up 5.54% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

JSC National Atomic  vs.  Sprott Physical Uranium

JSC National Atomic

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JSC National Atomic are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, JSC National may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Sprott Physical Uranium

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sprott Physical Uranium has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Pair Trading with JSC National and Sprott Physical

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

The idea behind JSC National Atomic and Sprott Physical Uranium 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.