Correlation Between Altair International and Western Copper
Can any of the company-specific risk be diversified away by investing in both Altair International 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 Altair International and Western Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altair International Corp and Western Copper and, you can compare the effects of market volatilities on Altair International 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 Altair International with a short position of Western Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altair International and Western Copper.
Diversification Opportunities for Altair International and Western Copper
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Altair and Western is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Altair International Corp and Western Copper and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Copper and Altair International 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 Altair International Corp 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 Altair International i.e., Altair International and Western Copper go up and down completely randomly.
Pair Corralation between Altair International and Western Copper
Given the investment horizon of 90 days Altair International Corp is expected to generate 5.61 times more return on investment than Western Copper. However, Altair International is 5.61 times more volatile than Western Copper and. It trades about 0.06 of its potential returns per unit of risk. Western Copper and is currently generating about -0.02 per unit of risk. If you would invest 32.00 in Altair International Corp on September 3, 2024 and sell it today you would lose (27.50) from holding Altair International Corp or give up 85.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altair International Corp vs. Western Copper and
Performance |
| Timeline |
| Altair International Corp |
| Western Copper |
Altair International and Western Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altair International and Western Copper
The main advantage of trading using opposite Altair International and Western Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altair International 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.| Altair International vs. Qubec Nickel Corp | Altair International vs. IGO Limited | Altair International vs. Avarone Metals | Altair International vs. Adriatic Metals PLC |
| Western Copper vs. Fury Gold Mines | Western Copper vs. EMX Royalty Corp | Western Copper vs. Nevada King Gold | Western Copper vs. Aftermath Silver |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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