Correlation Between Sprott Physical and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Sprott Physical and Credit Suisse 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 Sprott Physical and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Physical Gold and Credit Suisse Group, you can compare the effects of market volatilities on Sprott Physical and Credit Suisse 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 Sprott Physical with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Physical and Credit Suisse.
Diversification Opportunities for Sprott Physical and Credit Suisse
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sprott and Credit is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Physical Gold and Credit Suisse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Group and Sprott Physical 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 Sprott Physical Gold are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Group has no effect on the direction of Sprott Physical i.e., Sprott Physical and Credit Suisse go up and down completely randomly.
Pair Corralation between Sprott Physical and Credit Suisse
Given the investment horizon of 90 days Sprott Physical Gold is expected to generate 0.19 times more return on investment than Credit Suisse. However, Sprott Physical Gold is 5.32 times less risky than Credit Suisse. It trades about 0.05 of its potential returns per unit of risk. Credit Suisse Group is currently generating about -0.12 per unit of risk. If you would invest 1,479 in Sprott Physical Gold on January 25, 2024 and sell it today you would earn a total of 322.00 from holding Sprott Physical Gold or generate 21.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 56.36% |
| Values | Daily Returns |
Sprott Physical Gold vs. Credit Suisse Group
Performance |
| Timeline |
| Sprott Physical Gold |
| Credit Suisse Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sprott Physical and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Physical and Credit Suisse
The main advantage of trading using opposite Sprott Physical and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Physical position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.| Sprott Physical vs. SPDR SP 500 | Sprott Physical vs. GE Aerospace | Sprott Physical vs. Merck Company | Sprott Physical vs. Exxon Mobil Corp |
| Credit Suisse vs. Barclays PLC ADR | Credit Suisse vs. HSBC Holdings PLC | Credit Suisse vs. ING Group NV | Credit Suisse vs. Citigroup |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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