Correlation Between Sierra Metals and American Battery
Can any of the company-specific risk be diversified away by investing in both Sierra Metals and American Battery 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 Sierra Metals and American Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sierra Metals and American Battery Technology, you can compare the effects of market volatilities on Sierra Metals and American Battery 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 Sierra Metals with a short position of American Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sierra Metals and American Battery.
Diversification Opportunities for Sierra Metals and American Battery
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sierra and American is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sierra Metals and American Battery Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Battery Tec and Sierra Metals 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 Sierra Metals are associated (or correlated) with American Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Battery Tec has no effect on the direction of Sierra Metals i.e., Sierra Metals and American Battery go up and down completely randomly.
Pair Corralation between Sierra Metals and American Battery
If you would invest (100.00) in Sierra Metals on December 29, 2024 and sell it today you would earn a total of 100.00 from holding Sierra Metals or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Sierra Metals vs. American Battery Technology
Performance |
Timeline |
Sierra Metals |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
American Battery Tec |
Sierra Metals and American Battery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sierra Metals and American Battery
The main advantage of trading using opposite Sierra Metals and American Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sierra Metals position performs unexpectedly, American Battery 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 American Battery will offset losses from the drop in American Battery's long position.Sierra Metals vs. Kenorland Minerals | Sierra Metals vs. Canstar Resources | Sierra Metals vs. Prime Mining Corp | Sierra Metals vs. Euro Manganese |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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