Correlation Between Canada Nickel and Surge Copper
Can any of the company-specific risk be diversified away by investing in both Canada Nickel and Surge 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 Canada Nickel and Surge Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canada Nickel and Surge Copper Corp, you can compare the effects of market volatilities on Canada Nickel and Surge 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 Canada Nickel with a short position of Surge Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canada Nickel and Surge Copper.
Diversification Opportunities for Canada Nickel and Surge Copper
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Canada and Surge is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Canada Nickel and Surge Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surge Copper Corp and Canada Nickel 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 Canada Nickel are associated (or correlated) with Surge Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surge Copper Corp has no effect on the direction of Canada Nickel i.e., Canada Nickel and Surge Copper go up and down completely randomly.
Pair Corralation between Canada Nickel and Surge Copper
Assuming the 90 days horizon Canada Nickel is expected to generate 36.9 times less return on investment than Surge Copper. But when comparing it to its historical volatility, Canada Nickel is 1.45 times less risky than Surge Copper. It trades about 0.0 of its potential returns per unit of risk. Surge Copper Corp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 9.00 in Surge Copper Corp on August 25, 2024 and sell it today you would earn a total of 0.50 from holding Surge Copper Corp or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canada Nickel vs. Surge Copper Corp
Performance |
| Timeline |
| Canada Nickel |
| Surge Copper Corp |
Canada Nickel and Surge Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canada Nickel and Surge Copper
The main advantage of trading using opposite Canada Nickel and Surge Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canada Nickel position performs unexpectedly, Surge 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 Surge Copper will offset losses from the drop in Surge Copper's long position.| Canada Nickel vs. FPX Nickel Corp | Canada Nickel vs. Talon Metals Corp | Canada Nickel vs. Giga Metals Corp | Canada Nickel vs. American Lithium Corp |
| Surge Copper vs. Kutcho Copper Corp | Surge Copper vs. CANEX Metals | Surge Copper vs. Highland Copper | Surge Copper vs. District 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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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