Correlation Between Amerigo Resources and Dor Copper
Can any of the company-specific risk be diversified away by investing in both Amerigo Resources and Dor 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 Amerigo Resources and Dor Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amerigo Resources and Dor Copper Mining, you can compare the effects of market volatilities on Amerigo Resources and Dor 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 Amerigo Resources with a short position of Dor Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amerigo Resources and Dor Copper.
Diversification Opportunities for Amerigo Resources and Dor Copper
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amerigo and Dor is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Amerigo Resources and Dor Copper Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dor Copper Mining and Amerigo Resources 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 Amerigo Resources are associated (or correlated) with Dor Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dor Copper Mining has no effect on the direction of Amerigo Resources i.e., Amerigo Resources and Dor Copper go up and down completely randomly.
Pair Corralation between Amerigo Resources and Dor Copper
Assuming the 90 days horizon Amerigo Resources is expected to generate 2.09 times less return on investment than Dor Copper. But when comparing it to its historical volatility, Amerigo Resources is 2.8 times less risky than Dor Copper. It trades about 0.06 of its potential returns per unit of risk. Dor Copper Mining is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 8.50 in Dor Copper Mining on August 26, 2024 and sell it today you would earn a total of 1.30 from holding Dor Copper Mining or generate 15.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amerigo Resources vs. Dor Copper Mining
Performance |
| Timeline |
| Amerigo Resources |
| Dor Copper Mining |
Amerigo Resources and Dor Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amerigo Resources and Dor Copper
The main advantage of trading using opposite Amerigo Resources and Dor Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amerigo Resources position performs unexpectedly, Dor 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 Dor Copper will offset losses from the drop in Dor Copper's long position.| Amerigo Resources vs. First Quantum Minerals | Amerigo Resources vs. Antofagasta PLC | Amerigo Resources vs. Capstone Copper Corp | Amerigo Resources vs. Copper Mountain Mining |
| Dor Copper vs. Imperial Metals | Dor Copper vs. Bell Copper | Dor Copper vs. Copper Fox Metals | Dor Copper vs. Arizona Sonoran Copper |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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