Correlation Between Superior Plus and Teck Resources
Can any of the company-specific risk be diversified away by investing in both Superior Plus and Teck 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 Superior Plus and Teck Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and Teck Resources Ltd, you can compare the effects of market volatilities on Superior Plus and Teck 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 Superior Plus with a short position of Teck Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Teck Resources.
Diversification Opportunities for Superior Plus and Teck Resources
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Superior and Teck is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Teck Resources Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teck Resources and Superior Plus 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 Superior Plus Corp are associated (or correlated) with Teck Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teck Resources has no effect on the direction of Superior Plus i.e., Superior Plus and Teck Resources go up and down completely randomly.
Pair Corralation between Superior Plus and Teck Resources
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the Teck Resources. But the stock apears to be less risky and, when comparing its historical volatility, Superior Plus Corp is 1.24 times less risky than Teck Resources. The stock trades about -0.02 of its potential returns per unit of risk. The Teck Resources Ltd is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,433 in Teck Resources Ltd on September 14, 2024 and sell it today you would earn a total of 889.00 from holding Teck Resources Ltd or generate 25.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Superior Plus Corp vs. Teck Resources Ltd
Performance |
| Timeline |
| Superior Plus Corp |
| Teck Resources |
Superior Plus and Teck Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and Teck Resources
The main advantage of trading using opposite Superior Plus and Teck Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, Teck 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 Teck Resources will offset losses from the drop in Teck Resources' long position.| Superior Plus vs. Boiron SA | Superior Plus vs. COSMOSTEEL HLDGS | Superior Plus vs. Vastned Retail NV | Superior Plus vs. BURLINGTON STORES |
| Teck Resources vs. BHP Group Limited | Teck Resources vs. Vale SA | Teck Resources vs. Superior Plus Corp | Teck Resources vs. SIVERS SEMICONDUCTORS AB |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |