Correlation Between Silver Hammer and Santacruz Silv

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

By analyzing existing cross correlation between Silver Hammer Mining and Santacruz Silv, you can compare the effects of market volatilities on Silver Hammer and Santacruz Silv 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 Silver Hammer with a short position of Santacruz Silv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silver Hammer and Santacruz Silv.

Diversification Opportunities for Silver Hammer and Santacruz Silv

-0.68

Correlation Coefficient

Silver Hammer  Santacruz Silv

Excellent diversification

The 3 months correlation between Silver and Santacruz is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Silver Hammer Mining and Santacruz Silv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santacruz Silv and Silver Hammer 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 Silver Hammer Mining are associated (or correlated) with Santacruz Silv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santacruz Silv has no effect on the direction of Silver Hammer i.e., Silver Hammer and Santacruz Silv go up and down completely randomly.

Pair Corralation between Silver Hammer and Santacruz Silv

Assuming the 90 days horizon Silver Hammer Mining is expected to under-perform the Santacruz Silv. In addition to that, Silver Hammer is 1.26 times more volatile than Santacruz Silv. It trades about -0.08 of its total potential returns per unit of risk. Santacruz Silv is currently generating about 0.19 per unit of volatility. If you would invest  24.00  in Santacruz Silv on February 26, 2024 and sell it today you would earn a total of  8.00  from holding Santacruz Silv or generate 33.33% return on investment over 90 days.

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

Silver Hammer Mining  vs.  Santacruz Silv

Silver Hammer Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Silver Hammer Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Santacruz Silv

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Santacruz Silv are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Santacruz Silv reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Silver Hammer and Santacruz Silv

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

The idea behind Silver Hammer Mining and Santacruz Silv 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..