Correlation Between Sparta Capital and ABOT
Can any of the company-specific risk be diversified away by investing in both Sparta Capital and ABOT 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 Sparta Capital and ABOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sparta Capital and ABOT, you can compare the effects of market volatilities on Sparta Capital and ABOT 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 Sparta Capital with a short position of ABOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sparta Capital and ABOT.
Diversification Opportunities for Sparta Capital and ABOT
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sparta and ABOT is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Sparta Capital and ABOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABOT and Sparta Capital 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 Sparta Capital are associated (or correlated) with ABOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABOT has no effect on the direction of Sparta Capital i.e., Sparta Capital and ABOT go up and down completely randomly.
Pair Corralation between Sparta Capital and ABOT
Assuming the 90 days horizon Sparta Capital is expected to generate 16.34 times more return on investment than ABOT. However, Sparta Capital is 16.34 times more volatile than ABOT. It trades about 0.05 of its potential returns per unit of risk. ABOT is currently generating about 0.07 per unit of risk. If you would invest 1.21 in Sparta Capital on September 25, 2025 and sell it today you would lose (0.21) from holding Sparta Capital or give up 17.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Sparta Capital vs. ABOT
Performance |
| Timeline |
| Sparta Capital |
| ABOT |
Sparta Capital and ABOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sparta Capital and ABOT
The main advantage of trading using opposite Sparta Capital and ABOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sparta Capital position performs unexpectedly, ABOT 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 ABOT will offset losses from the drop in ABOT's long position.| Sparta Capital vs. Canadian Palladium Resources | Sparta Capital vs. Champion Bear Resources | Sparta Capital vs. REDFLEX HOLDINGS LTD | Sparta Capital vs. Wolverine Technologies Corp |
| ABOT vs. Strategy Shares | ABOT vs. Freedom Day Dividend | ABOT vs. Davis Select International | ABOT vs. iShares MSCI China |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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