Correlation Between Fabled Copper and Kodiak Copper

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

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

Diversification Opportunities for Fabled Copper and Kodiak Copper

0.0

Correlation Coefficient

Fabled Copper  Kodiak Copper

Pay attention - limited upside

The 3 months correlation between Fabled and Kodiak is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fabled Copper Corp and Kodiak Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kodiak Copper Corp and Fabled Copper 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 Fabled Copper Corp are associated (or correlated) with Kodiak Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kodiak Copper Corp has no effect on the direction of Fabled Copper i.e., Fabled Copper and Kodiak Copper go up and down completely randomly.

Pair Corralation between Fabled Copper and Kodiak Copper

If you would invest  2.52  in Fabled Copper Corp on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Fabled Copper Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Fabled Copper Corp  vs.  Kodiak Copper Corp

Fabled Copper Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fabled Copper Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Fabled Copper is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Kodiak Copper Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kodiak Copper 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 fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Fabled Copper and Kodiak Copper

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

The idea behind Fabled Copper Corp and Kodiak Copper Corp 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.