Correlation Between Copperbank Resources and ABG Acquisition

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

By analyzing existing cross correlation between Copperbank Resources Corp and ABG Acquisition I, you can compare the effects of market volatilities on Copperbank Resources and ABG Acquisition 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 Copperbank Resources with a short position of ABG Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copperbank Resources and ABG Acquisition.

Diversification Opportunities for Copperbank Resources and ABG Acquisition

-0.08

Correlation Coefficient

Copperbank Resources  ABG Acquisition

Good diversification

The 3 months correlation between Copperbank and ABG is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Copperbank Resources Corp and ABG Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABG Acquisition I and Copperbank Resources 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 Copperbank Resources Corp are associated (or correlated) with ABG Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABG Acquisition I has no effect on the direction of Copperbank Resources i.e., Copperbank Resources and ABG Acquisition go up and down completely randomly.

Pair Corralation between Copperbank Resources and ABG Acquisition

If you would invest  1,020  in ABG Acquisition I on October 9, 2024 and sell it today you would earn a total of  0.00  from holding ABG Acquisition I or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

Copperbank Resources Corp  vs.  ABG Acquisition I

Copperbank Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Copperbank Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward-looking signals remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

ABG Acquisition I

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ABG Acquisition I has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, ABG Acquisition is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Copperbank Resources and ABG Acquisition

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

The idea behind Copperbank Resources Corp and ABG Acquisition I 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.