Correlation Between Eagle Point and Sprott

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

By analyzing existing cross correlation between Eagle Point Credit and Sprott Inc, you can compare the effects of market volatilities on Eagle Point and Sprott 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 Eagle Point with a short position of Sprott. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Point and Sprott.

Diversification Opportunities for Eagle Point and Sprott

-0.43

Correlation Coefficient

Eagle Point  Sprott

Very good diversification

The 3 months correlation between Eagle and Sprott is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Point Credit and Sprott Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Inc and Eagle Point 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 Eagle Point Credit are associated (or correlated) with Sprott. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Inc has no effect on the direction of Eagle Point i.e., Eagle Point and Sprott go up and down completely randomly.

Pair Corralation between Eagle Point and Sprott

Considering the 90-day investment horizon Eagle Point Credit is expected to under-perform the Sprott. But the stock apears to be less risky and, when comparing its historical volatility, Eagle Point Credit is 1.28 times less risky than Sprott. The stock trades about -0.08 of its potential returns per unit of risk. The Sprott Inc is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  7,012  in Sprott Inc on September 13, 2025 and sell it today you would earn a total of  2,368  from holding Sprott Inc or generate 33.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Eagle Point Credit  vs.  Sprott Inc

Eagle Point Credit

Risk-Adjusted Performance

Weakest

Over the last 90 days Eagle Point Credit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Sprott Inc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Inc are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Sprott demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eagle Point and Sprott

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

The idea behind Eagle Point Credit and Sprott Inc 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.