Correlation Between Aluminum Corp and North Copper
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By analyzing existing cross correlation between Aluminum Corp of and North Copper Shanxi, you can compare the effects of market volatilities on Aluminum Corp and North 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 Aluminum Corp with a short position of North Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aluminum Corp and North Copper.
Diversification Opportunities for Aluminum Corp and North Copper
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aluminum and North is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Aluminum Corp of and North Copper Shanxi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Copper Shanxi and Aluminum Corp 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 Aluminum Corp of are associated (or correlated) with North Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Copper Shanxi has no effect on the direction of Aluminum Corp i.e., Aluminum Corp and North Copper go up and down completely randomly.
Pair Corralation between Aluminum Corp and North Copper
Assuming the 90 days trading horizon Aluminum Corp is expected to generate 4.16 times less return on investment than North Copper. But when comparing it to its historical volatility, Aluminum Corp of is 1.92 times less risky than North Copper. It trades about 0.02 of its potential returns per unit of risk. North Copper Shanxi is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 875.00 in North Copper Shanxi on October 26, 2024 and sell it today you would earn a total of 27.00 from holding North Copper Shanxi or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aluminum Corp of vs. North Copper Shanxi
Performance |
| Timeline |
| Aluminum Corp |
| North Copper Shanxi |
Aluminum Corp and North Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aluminum Corp and North Copper
The main advantage of trading using opposite Aluminum Corp and North Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aluminum Corp position performs unexpectedly, North 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 North Copper will offset losses from the drop in North Copper's long position.| Aluminum Corp vs. Zijin Mining Group | Aluminum Corp vs. Wanhua Chemical Group | Aluminum Corp vs. Baoshan Iron Steel | Aluminum Corp vs. Shandong Gold Mining |
| North Copper vs. Aluminum Corp of | North Copper vs. Sino Platinum Metals Co | North Copper vs. Tianshan Aluminum Group | North Copper vs. Vanfund Urban Investment |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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