Correlation Between QC Copper and Maple Leaf
Can any of the company-specific risk be diversified away by investing in both QC Copper and Maple Leaf 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 QC Copper and Maple Leaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QC Copper and and Maple Leaf Foods, you can compare the effects of market volatilities on QC Copper and Maple Leaf 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 QC Copper with a short position of Maple Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of QC Copper and Maple Leaf.
Diversification Opportunities for QC Copper and Maple Leaf
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between QCCU and Maple is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding QC Copper and and Maple Leaf Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Leaf Foods and QC 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 QC Copper and are associated (or correlated) with Maple Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Leaf Foods has no effect on the direction of QC Copper i.e., QC Copper and Maple Leaf go up and down completely randomly.
Pair Corralation between QC Copper and Maple Leaf
Assuming the 90 days trading horizon QC Copper is expected to generate 2.43 times less return on investment than Maple Leaf. In addition to that, QC Copper is 2.01 times more volatile than Maple Leaf Foods. It trades about 0.02 of its total potential returns per unit of risk. Maple Leaf Foods is currently generating about 0.1 per unit of volatility. If you would invest 2,239 in Maple Leaf Foods on December 2, 2024 and sell it today you would earn a total of 307.00 from holding Maple Leaf Foods or generate 13.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 80.65% |
Values | Daily Returns |
QC Copper and vs. Maple Leaf Foods
Performance |
Timeline |
QC Copper |
Risk-Adjusted Performance
Weak
Weak | Strong |
Maple Leaf Foods |
QC Copper and Maple Leaf Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with QC Copper and Maple Leaf
The main advantage of trading using opposite QC Copper and Maple Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QC Copper position performs unexpectedly, Maple Leaf 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 Maple Leaf will offset losses from the drop in Maple Leaf's long position.QC Copper vs. Baselode Energy Corp | QC Copper vs. Surge Copper Corp | QC Copper vs. Marimaca Copper Corp | QC Copper vs. Kodiak Copper Corp |
Maple Leaf vs. Saputo Inc | Maple Leaf vs. George Weston Limited | Maple Leaf vs. Empire Company Limited | Maple Leaf vs. Premium Brands Holdings |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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