Correlation Between Fortuna Silver and Copper Lake
Can any of the company-specific risk be diversified away by investing in both Fortuna Silver and Copper Lake 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 Fortuna Silver and Copper Lake into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortuna Silver Mines and Copper Lake Resources, you can compare the effects of market volatilities on Fortuna Silver and Copper Lake 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 Fortuna Silver with a short position of Copper Lake. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortuna Silver and Copper Lake.
Diversification Opportunities for Fortuna Silver and Copper Lake
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fortuna and Copper is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Fortuna Silver Mines and Copper Lake Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copper Lake Resources and Fortuna Silver 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 Fortuna Silver Mines are associated (or correlated) with Copper Lake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copper Lake Resources has no effect on the direction of Fortuna Silver i.e., Fortuna Silver and Copper Lake go up and down completely randomly.
Pair Corralation between Fortuna Silver and Copper Lake
Considering the 90-day investment horizon Fortuna Silver is expected to generate 9.22 times less return on investment than Copper Lake. But when comparing it to its historical volatility, Fortuna Silver Mines is 8.8 times less risky than Copper Lake. It trades about 0.16 of its potential returns per unit of risk. Copper Lake Resources is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 0.50 in Copper Lake Resources on December 25, 2024 and sell it today you would earn a total of 0.50 from holding Copper Lake Resources or generate 100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.33% |
Values | Daily Returns |
Fortuna Silver Mines vs. Copper Lake Resources
Performance |
Timeline |
Fortuna Silver Mines |
Copper Lake Resources |
Fortuna Silver and Copper Lake Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fortuna Silver and Copper Lake
The main advantage of trading using opposite Fortuna Silver and Copper Lake positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortuna Silver position performs unexpectedly, Copper Lake 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 Copper Lake will offset losses from the drop in Copper Lake's long position.Fortuna Silver vs. Pan American Silver | Fortuna Silver vs. Harmony Gold Mining | Fortuna Silver vs. IAMGold | Fortuna Silver vs. Kinross Gold |
Copper Lake vs. Black Widow Resources | Copper Lake vs. Eros Resources Corp | Copper Lake vs. Magnum Goldcorp |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
Stocks Directory Find actively traded stocks across global markets | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |