Correlation Between Tat Techno and Copperbank Resources

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

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

Diversification Opportunities for Tat Techno and Copperbank Resources

-0.73

Correlation Coefficient

Tat Techno  Copperbank Resources

Pay attention - limited upside

The 3 months correlation between Tat and Copperbank is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Tat Techno and Copperbank Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copperbank Resources Corp and Tat Techno 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 Tat Techno are associated (or correlated) with Copperbank Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copperbank Resources Corp has no effect on the direction of Tat Techno i.e., Tat Techno and Copperbank Resources go up and down completely randomly.

Pair Corralation between Tat Techno and Copperbank Resources

Given the investment horizon of 90 days Tat Techno is expected to generate 0.98 times more return on investment than Copperbank Resources. However, Tat Techno is 1.02 times less risky than Copperbank Resources. It trades about 0.24 of its potential returns per unit of risk. Copperbank Resources Corp is currently generating about -0.23 per unit of risk. If you would invest  2,223  in Tat Techno on September 23, 2024 and sell it today you would earn a total of  377.00  from holding Tat Techno or generate 16.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Tat Techno  vs.  Copperbank Resources Corp

Tat Techno

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tat Techno are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Tat Techno unveiled solid returns over the last few months and may actually be approaching a breakup point.

Copperbank Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Copperbank Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, Copperbank Resources is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Tat Techno and Copperbank Resources

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

The idea behind Tat Techno and Copperbank Resources 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.