Correlation Between First Majestic and Kutcho Copper
Can any of the company-specific risk be diversified away by investing in both First Majestic and Kutcho 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 First Majestic and Kutcho Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Majestic Silver and Kutcho Copper Corp, you can compare the effects of market volatilities on First Majestic and Kutcho 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 First Majestic with a short position of Kutcho Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Majestic and Kutcho Copper.
Diversification Opportunities for First Majestic and Kutcho Copper
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Kutcho is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding First Majestic Silver and Kutcho Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kutcho Copper Corp and First Majestic 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 First Majestic Silver are associated (or correlated) with Kutcho Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kutcho Copper Corp has no effect on the direction of First Majestic i.e., First Majestic and Kutcho Copper go up and down completely randomly.
Pair Corralation between First Majestic and Kutcho Copper
Assuming the 90 days horizon First Majestic is expected to generate 2.21 times less return on investment than Kutcho Copper. But when comparing it to its historical volatility, First Majestic Silver is 1.57 times less risky than Kutcho Copper. It trades about 0.06 of its potential returns per unit of risk. Kutcho Copper Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Kutcho Copper Corp on November 28, 2024 and sell it today you would earn a total of 1.00 from holding Kutcho Copper Corp or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
First Majestic Silver vs. Kutcho Copper Corp
Performance |
| Timeline |
| First Majestic Silver |
| Kutcho Copper Corp |
First Majestic and Kutcho Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Majestic and Kutcho Copper
The main advantage of trading using opposite First Majestic and Kutcho Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Majestic position performs unexpectedly, Kutcho 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 Kutcho Copper will offset losses from the drop in Kutcho Copper's long position.| First Majestic vs. Ivanhoe Energy | First Majestic vs. Flinders Resources Limited | First Majestic vs. Orezone Gold Corp | First Majestic vs. Faraday Copper Corp |
| Kutcho Copper vs. Surge Copper Corp | Kutcho Copper vs. Golden Pursuit Resources | Kutcho Copper vs. Wildsky Resources | Kutcho Copper vs. CANEX Metals |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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