Correlation Between BTC Health and Cooper Metals
Can any of the company-specific risk be diversified away by investing in both BTC Health and Cooper Metals 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 BTC Health and Cooper Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTC Health Limited and Cooper Metals, you can compare the effects of market volatilities on BTC Health and Cooper Metals 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 BTC Health with a short position of Cooper Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTC Health and Cooper Metals.
Diversification Opportunities for BTC Health and Cooper Metals
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BTC and Cooper is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding BTC Health Limited and Cooper Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cooper Metals and BTC Health 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 BTC Health Limited are associated (or correlated) with Cooper Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cooper Metals has no effect on the direction of BTC Health i.e., BTC Health and Cooper Metals go up and down completely randomly.
Pair Corralation between BTC Health and Cooper Metals
Assuming the 90 days trading horizon BTC Health Limited is expected to generate 0.85 times more return on investment than Cooper Metals. However, BTC Health Limited is 1.18 times less risky than Cooper Metals. It trades about 0.23 of its potential returns per unit of risk. Cooper Metals is currently generating about 0.08 per unit of risk. If you would invest 5.00 in BTC Health Limited on September 3, 2024 and sell it today you would earn a total of 0.70 from holding BTC Health Limited or generate 14.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTC Health Limited vs. Cooper Metals
Performance |
| Timeline |
| BTC Health Limited |
| Cooper Metals |
BTC Health and Cooper Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTC Health and Cooper Metals
The main advantage of trading using opposite BTC Health and Cooper Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTC Health position performs unexpectedly, Cooper Metals 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 Cooper Metals will offset losses from the drop in Cooper Metals' long position.| BTC Health vs. TTG Fintech | BTC Health vs. Land Homes Group | BTC Health vs. Regis Healthcare | BTC Health vs. Horseshoe Metals |
| Cooper Metals vs. Richmond Vanadium Technology | Cooper Metals vs. Metro Mining | Cooper Metals vs. Ras Technology Holdings | Cooper Metals vs. Dug Technology |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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