Correlation Between Silver Spike and Neptune Wellness
Can any of the company-specific risk be diversified away by investing in both Silver Spike and Neptune Wellness 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 Spike and Neptune Wellness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silver Spike Investment and Neptune Wellness Solutions, you can compare the effects of market volatilities on Silver Spike and Neptune Wellness 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 Spike with a short position of Neptune Wellness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silver Spike and Neptune Wellness.
Diversification Opportunities for Silver Spike and Neptune Wellness
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Silver and Neptune is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Silver Spike Investment and Neptune Wellness Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neptune Wellness Sol and Silver Spike 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 Spike Investment are associated (or correlated) with Neptune Wellness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neptune Wellness Sol has no effect on the direction of Silver Spike i.e., Silver Spike and Neptune Wellness go up and down completely randomly.
Pair Corralation between Silver Spike and Neptune Wellness
Given the investment horizon of 90 days Silver Spike Investment is expected to generate 0.03 times more return on investment than Neptune Wellness. However, Silver Spike Investment is 36.31 times less risky than Neptune Wellness. It trades about 0.2 of its potential returns per unit of risk. Neptune Wellness Solutions is currently generating about -0.66 per unit of risk. If you would invest 975.00 in Silver Spike Investment on March 5, 2024 and sell it today you would earn a total of 160.00 from holding Silver Spike Investment or generate 16.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 7.94% |
Values | Daily Returns |
Silver Spike Investment vs. Neptune Wellness Solutions
Performance |
Timeline |
Silver Spike Investment |
Neptune Wellness Sol |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Silver Spike and Neptune Wellness Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Silver Spike and Neptune Wellness
The main advantage of trading using opposite Silver Spike and Neptune Wellness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silver Spike position performs unexpectedly, Neptune Wellness 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 Neptune Wellness will offset losses from the drop in Neptune Wellness' long position.Silver Spike vs. Entourage Health Corp | Silver Spike vs. Avicanna | Silver Spike vs. Benchmark Botanics | Silver Spike vs. Speakeasy Cannabis Club |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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