Correlation Between ELL ENVIRONHLDGS and Western Copper
Can any of the company-specific risk be diversified away by investing in both ELL ENVIRONHLDGS and Western 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 ELL ENVIRONHLDGS and Western Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ELL ENVIRONHLDGS HD 0001 and Western Copper and, you can compare the effects of market volatilities on ELL ENVIRONHLDGS and Western 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 ELL ENVIRONHLDGS with a short position of Western Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of ELL ENVIRONHLDGS and Western Copper.
Diversification Opportunities for ELL ENVIRONHLDGS and Western Copper
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ELL and Western is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding ELL ENVIRONHLDGS HD 0001 and Western Copper and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Copper and ELL ENVIRONHLDGS 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 ELL ENVIRONHLDGS HD 0001 are associated (or correlated) with Western Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Copper has no effect on the direction of ELL ENVIRONHLDGS i.e., ELL ENVIRONHLDGS and Western Copper go up and down completely randomly.
Pair Corralation between ELL ENVIRONHLDGS and Western Copper
Assuming the 90 days horizon ELL ENVIRONHLDGS HD 0001 is expected to under-perform the Western Copper. But the stock apears to be less risky and, when comparing its historical volatility, ELL ENVIRONHLDGS HD 0001 is 1.09 times less risky than Western Copper. The stock trades about -0.21 of its potential returns per unit of risk. The Western Copper and is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 96.00 in Western Copper and on October 25, 2024 and sell it today you would earn a total of 1.00 from holding Western Copper and or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ELL ENVIRONHLDGS HD 0001 vs. Western Copper and
Performance |
| Timeline |
| ELL ENVIRONHLDGS |
| Western Copper |
ELL ENVIRONHLDGS and Western Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ELL ENVIRONHLDGS and Western Copper
The main advantage of trading using opposite ELL ENVIRONHLDGS and Western Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ELL ENVIRONHLDGS position performs unexpectedly, Western 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 Western Copper will offset losses from the drop in Western Copper's long position.| ELL ENVIRONHLDGS vs. FAST RETAIL ADR | ELL ENVIRONHLDGS vs. Canon Marketing Japan | ELL ENVIRONHLDGS vs. TRADEDOUBLER AB SK | ELL ENVIRONHLDGS vs. Tradegate AG Wertpapierhandelsbank |
| Western Copper vs. RELIANCE STEEL AL | Western Copper vs. British American Tobacco | Western Copper vs. ELL ENVIRONHLDGS HD 0001 | Western Copper vs. Nippon Steel |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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