Correlation Between Hudbay Minerals and Copper Mountain

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

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

Diversification Opportunities for Hudbay Minerals and Copper Mountain

0.43

Correlation Coefficient

Hudbay Minerals  Copper Mountain

Very weak diversification

The 3 months correlation between Hudbay and Copper is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hudbay Minerals and Copper Mountain Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copper Mountain Mining and Hudbay Minerals 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 Hudbay Minerals are associated (or correlated) with Copper Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copper Mountain Mining has no effect on the direction of Hudbay Minerals i.e., Hudbay Minerals and Copper Mountain go up and down completely randomly.

Pair Corralation between Hudbay Minerals and Copper Mountain

Considering the 90-day investment horizon Hudbay Minerals is expected to generate 0.78 times more return on investment than Copper Mountain. However, Hudbay Minerals is 1.28 times less risky than Copper Mountain. It trades about 0.0 of its potential returns per unit of risk. Copper Mountain Mining is currently generating about -0.1 per unit of risk. If you would invest  800.00  in Hudbay Minerals on December 28, 2024 and sell it today you would lose (31.00) from holding Hudbay Minerals or give up 3.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Hudbay Minerals  vs.  Copper Mountain Mining

Hudbay Minerals

Risk-Adjusted Performance

Weak

Over the last 90 days Hudbay Minerals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Hudbay Minerals is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Copper Mountain Mining

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Hudbay Minerals and Copper Mountain

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

The idea behind Hudbay Minerals and Copper Mountain Mining 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.