Correlation Between Sprott Physical and Infrastructure Dividend

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

By analyzing existing cross correlation between Sprott Physical Silver and Infrastructure Dividend Split, you can compare the effects of market volatilities on Sprott Physical and Infrastructure Dividend 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 Sprott Physical with a short position of Infrastructure Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Physical and Infrastructure Dividend.

Diversification Opportunities for Sprott Physical and Infrastructure Dividend

0.71

Correlation Coefficient

Sprott Physical  Infrastructure Dividend

Poor diversification

The 3 months correlation between Sprott and Infrastructure is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Physical Silver and Infrastructure Dividend Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infrastructure Dividend and Sprott Physical 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 Sprott Physical Silver are associated (or correlated) with Infrastructure Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infrastructure Dividend has no effect on the direction of Sprott Physical i.e., Sprott Physical and Infrastructure Dividend go up and down completely randomly.

Pair Corralation between Sprott Physical and Infrastructure Dividend

Assuming the 90 days trading horizon Sprott Physical Silver is expected to generate 1.63 times more return on investment than Infrastructure Dividend. However, Sprott Physical is 1.63 times more volatile than Infrastructure Dividend Split. It trades about 0.19 of its potential returns per unit of risk. Infrastructure Dividend Split is currently generating about 0.28 per unit of risk. If you would invest  1,508  in Sprott Physical Silver on April 30, 2025 and sell it today you would earn a total of  266.00  from holding Sprott Physical Silver or generate 17.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Sprott Physical Silver  vs.  Infrastructure Dividend Split

Sprott Physical Silver

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Physical Silver are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Sprott Physical displayed solid returns over the last few months and may actually be approaching a breakup point.

Infrastructure Dividend

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Infrastructure Dividend Split are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Infrastructure Dividend displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sprott Physical and Infrastructure Dividend

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

The idea behind Sprott Physical Silver and Infrastructure Dividend Split 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.