Correlation Between Guardian Capital and Sprott

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

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

Diversification Opportunities for Guardian Capital and Sprott

0.52

Correlation Coefficient

Guardian Capital  Sprott

Very weak diversification

The 3 months correlation between Guardian and Sprott is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Guardian Capital Group and Sprott Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Inc and Guardian 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 Guardian Capital Group 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 Guardian Capital i.e., Guardian Capital and Sprott go up and down completely randomly.

Pair Corralation between Guardian Capital and Sprott

Assuming the 90 days trading horizon Guardian Capital is expected to generate 4.23 times less return on investment than Sprott. In addition to that, Guardian Capital is 1.21 times more volatile than Sprott Inc. It trades about 0.07 of its total potential returns per unit of risk. Sprott Inc is currently generating about 0.38 per unit of volatility. If you would invest  7,439  in Sprott Inc on April 22, 2025 and sell it today you would earn a total of  2,910  from holding Sprott Inc or generate 39.12% return on investment over 90 days.

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

Guardian Capital Group  vs.  Sprott Inc

Guardian Capital

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Guardian Capital Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Guardian Capital may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Sprott Inc

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Sprott Inc are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Sprott displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Guardian Capital and Sprott

The main advantage of trading using opposite Guardian Capital and Sprott positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardian Capital 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 Guardian Capital Group 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.