Correlation Between CopperCorp Resources and KGHM Polska
Can any of the company-specific risk be diversified away by investing in both CopperCorp Resources and KGHM Polska 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 CopperCorp Resources and KGHM Polska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CopperCorp Resources and KGHM Polska Miedz, you can compare the effects of market volatilities on CopperCorp Resources and KGHM Polska 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 CopperCorp Resources with a short position of KGHM Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of CopperCorp Resources and KGHM Polska.
Diversification Opportunities for CopperCorp Resources and KGHM Polska
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CopperCorp and KGHM is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding CopperCorp Resources and KGHM Polska Miedz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KGHM Polska Miedz and CopperCorp 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 CopperCorp Resources are associated (or correlated) with KGHM Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KGHM Polska Miedz has no effect on the direction of CopperCorp Resources i.e., CopperCorp Resources and KGHM Polska go up and down completely randomly.
Pair Corralation between CopperCorp Resources and KGHM Polska
If you would invest 5.50 in CopperCorp Resources on August 26, 2024 and sell it today you would earn a total of 5.50 from holding CopperCorp Resources or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
CopperCorp Resources vs. KGHM Polska Miedz
Performance |
| Timeline |
| CopperCorp Resources |
| KGHM Polska Miedz |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CopperCorp Resources and KGHM Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CopperCorp Resources and KGHM Polska
The main advantage of trading using opposite CopperCorp Resources and KGHM Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CopperCorp Resources position performs unexpectedly, KGHM Polska 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 KGHM Polska will offset losses from the drop in KGHM Polska's long position.| CopperCorp Resources vs. Bell Copper | CopperCorp Resources vs. Copper Fox Metals | CopperCorp Resources vs. First Quantum Minerals | CopperCorp Resources vs. Southern Copper |
| KGHM Polska vs. Bell Copper | KGHM Polska vs. Arizona Sonoran Copper | KGHM Polska vs. CopperCorp Resources | KGHM Polska vs. Dor Copper Mining |
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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