Correlation Between Summa Silver and Stamper Oil

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Can any of the company-specific risk be diversified away by investing in both Summa Silver and Stamper Oil 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 Summa Silver and Stamper Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summa Silver Corp and Stamper Oil Gas, you can compare the effects of market volatilities on Summa Silver and Stamper Oil 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 Summa Silver with a short position of Stamper Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summa Silver and Stamper Oil.

Diversification Opportunities for Summa Silver and Stamper Oil

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Summa and Stamper is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Summa Silver Corp and Stamper Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stamper Oil Gas and Summa Silver 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 Summa Silver Corp are associated (or correlated) with Stamper Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stamper Oil Gas has no effect on the direction of Summa Silver i.e., Summa Silver and Stamper Oil go up and down completely randomly.

Pair Corralation between Summa Silver and Stamper Oil

If you would invest (100.00) in Stamper Oil Gas on September 11, 2024 and sell it today you would earn a total of  100.00  from holding Stamper Oil Gas or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Summa Silver Corp  vs.  Stamper Oil Gas

 Performance 
       Timeline  
Summa Silver Corp 

Risk-Adjusted Performance

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Over the last 90 days Summa Silver Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.
Stamper Oil Gas 

Risk-Adjusted Performance

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Weak
 
Strong
Insignificant
Over the last 90 days Stamper Oil Gas has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable primary indicators, Stamper Oil is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Summa Silver and Stamper Oil Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Summa Silver and Stamper Oil

The main advantage of trading using opposite Summa Silver and Stamper Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summa Silver position performs unexpectedly, Stamper Oil 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 Stamper Oil will offset losses from the drop in Stamper Oil's long position.
The idea behind Summa Silver Corp and Stamper Oil Gas 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.

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