Correlation Between Chakana Copper and Surge Copper

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

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

Diversification Opportunities for Chakana Copper and Surge Copper

0.0

Correlation Coefficient

Chakana Copper  Surge Copper

Pay attention - limited upside

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

Pair Corralation between Chakana Copper and Surge Copper

Assuming the 90 days trading horizon Chakana Copper Corp is expected to under-perform the Surge Copper. In addition to that, Chakana Copper is 2.36 times more volatile than Surge Copper Corp. It trades about -0.01 of its total potential returns per unit of risk. Surge Copper Corp is currently generating about 0.03 per unit of volatility. If you would invest  11.00  in Surge Copper Corp on December 20, 2024 and sell it today you would earn a total of  0.00  from holding Surge 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

Chakana Copper Corp  vs.  Surge Copper Corp

Chakana Copper Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chakana Copper Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Surge Copper Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Surge Copper Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Surge Copper showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Chakana Copper and Surge Copper

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

The idea behind Chakana Copper Corp and Surge 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.