Correlation Between Neometals and Sancus Lending

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

By analyzing existing cross correlation between Neometals and Sancus Lending Group, you can compare the effects of market volatilities on Neometals and Sancus Lending 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 Neometals with a short position of Sancus Lending. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neometals and Sancus Lending.

Diversification Opportunities for Neometals and Sancus Lending

0.13

Correlation Coefficient

Neometals  Sancus Lending

Average diversification

The 3 months correlation between Neometals and Sancus is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Neometals and Sancus Lending Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sancus Lending Group and Neometals 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 Neometals are associated (or correlated) with Sancus Lending. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sancus Lending Group has no effect on the direction of Neometals i.e., Neometals and Sancus Lending go up and down completely randomly.

Pair Corralation between Neometals and Sancus Lending

Assuming the 90 days trading horizon Neometals is expected to under-perform the Sancus Lending. But the stock apears to be less risky and, when comparing its historical volatility, Neometals is 2.35 times less risky than Sancus Lending. The stock trades about -0.09 of its potential returns per unit of risk. The Sancus Lending Group is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  150.00  in Sancus Lending Group on September 12, 2024 and sell it today you would lose (115.00) from holding Sancus Lending Group or give up 76.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Neometals  vs.  Sancus Lending Group

Neometals

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Neometals are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Neometals exhibited solid returns over the last few months and may actually be approaching a breakup point.

Sancus Lending Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sancus Lending Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Neometals and Sancus Lending

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

The idea behind Neometals and Sancus Lending Group 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.