Correlation Between Aguila American and Ero Copper
Can any of the company-specific risk be diversified away by investing in both Aguila American and Ero 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 Aguila American and Ero Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aguila American Gold and Ero Copper Corp, you can compare the effects of market volatilities on Aguila American and Ero 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 Aguila American with a short position of Ero Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aguila American and Ero Copper.
Diversification Opportunities for Aguila American and Ero Copper
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aguila and Ero is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Aguila American Gold and Ero Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ero Copper Corp and Aguila American 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 Aguila American Gold are associated (or correlated) with Ero Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ero Copper Corp has no effect on the direction of Aguila American i.e., Aguila American and Ero Copper go up and down completely randomly.
Pair Corralation between Aguila American and Ero Copper
If you would invest 28.00 in Aguila American Gold on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Aguila American Gold or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Aguila American Gold vs. Ero Copper Corp
Performance |
| Timeline |
| Aguila American Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Ero Copper Corp |
Aguila American and Ero Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aguila American and Ero Copper
The main advantage of trading using opposite Aguila American and Ero Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aguila American position performs unexpectedly, Ero 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 Ero Copper will offset losses from the drop in Ero Copper's long position.| Aguila American vs. Arizona Sonoran Copper | Aguila American vs. Dor Copper Mining | Aguila American vs. CopperCorp Resources | Aguila American vs. Copper Fox Metals |
| Ero Copper vs. Freeport McMoran Copper Gold | Ero Copper vs. Amerigo Resources | Ero Copper vs. Hudbay Minerals | Ero Copper vs. Capstone Copper Corp |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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