Correlation Between Marimaca Copper and Copper Fox
Can any of the company-specific risk be diversified away by investing in both Marimaca Copper and Copper Fox 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 Marimaca Copper and Copper Fox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marimaca Copper Corp and Copper Fox Metals, you can compare the effects of market volatilities on Marimaca Copper and Copper Fox 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 Marimaca Copper with a short position of Copper Fox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marimaca Copper and Copper Fox.
Diversification Opportunities for Marimaca Copper and Copper Fox
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Marimaca and Copper is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Marimaca Copper Corp and Copper Fox Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copper Fox Metals and Marimaca 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 Marimaca Copper Corp are associated (or correlated) with Copper Fox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copper Fox Metals has no effect on the direction of Marimaca Copper i.e., Marimaca Copper and Copper Fox go up and down completely randomly.
Pair Corralation between Marimaca Copper and Copper Fox
Assuming the 90 days trading horizon Marimaca Copper Corp is expected to generate 0.41 times more return on investment than Copper Fox. However, Marimaca Copper Corp is 2.43 times less risky than Copper Fox. It trades about 0.15 of its potential returns per unit of risk. Copper Fox Metals is currently generating about 0.02 per unit of risk. If you would invest 430.00 in Marimaca Copper Corp on October 25, 2024 and sell it today you would earn a total of 126.00 from holding Marimaca Copper Corp or generate 29.3% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Marimaca Copper Corp vs. Copper Fox Metals
Performance |
Timeline |
Marimaca Copper Corp |
Copper Fox Metals |
Marimaca Copper and Copper Fox Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marimaca Copper and Copper Fox
The main advantage of trading using opposite Marimaca Copper and Copper Fox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marimaca Copper position performs unexpectedly, Copper Fox 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 Fox will offset losses from the drop in Copper Fox's long position.Marimaca Copper vs. Ero Copper Corp | ||
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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