Correlation Between Cooper Metals and Pinnacle Investment
Can any of the company-specific risk be diversified away by investing in both Cooper Metals and Pinnacle Investment 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 Cooper Metals and Pinnacle Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cooper Metals and Pinnacle Investment Management, you can compare the effects of market volatilities on Cooper Metals and Pinnacle Investment 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 Cooper Metals with a short position of Pinnacle Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cooper Metals and Pinnacle Investment.
Diversification Opportunities for Cooper Metals and Pinnacle Investment
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cooper and Pinnacle is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Cooper Metals and Pinnacle Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinnacle Investment and Cooper Metals 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 Cooper Metals are associated (or correlated) with Pinnacle Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinnacle Investment has no effect on the direction of Cooper Metals i.e., Cooper Metals and Pinnacle Investment go up and down completely randomly.
Pair Corralation between Cooper Metals and Pinnacle Investment
Assuming the 90 days trading horizon Cooper Metals is expected to under-perform the Pinnacle Investment. In addition to that, Cooper Metals is 1.77 times more volatile than Pinnacle Investment Management. It trades about -0.06 of its total potential returns per unit of risk. Pinnacle Investment Management is currently generating about 0.35 per unit of volatility. If you would invest 2,013 in Pinnacle Investment Management on September 1, 2024 and sell it today you would earn a total of 331.00 from holding Pinnacle Investment Management or generate 16.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cooper Metals vs. Pinnacle Investment Management
Performance |
| Timeline |
| Cooper Metals |
| Pinnacle Investment |
Cooper Metals and Pinnacle Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cooper Metals and Pinnacle Investment
The main advantage of trading using opposite Cooper Metals and Pinnacle Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cooper Metals position performs unexpectedly, Pinnacle Investment 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 Pinnacle Investment will offset losses from the drop in Pinnacle Investment's long position.| Cooper Metals vs. Ironbark Capital | Cooper Metals vs. BTC Health Limited | Cooper Metals vs. Mount Gibson Iron | Cooper Metals vs. Aristocrat Leisure |
| Pinnacle Investment vs. WA1 Resources | Pinnacle Investment vs. Predictive Discovery | Pinnacle Investment vs. Cooper Metals | Pinnacle Investment vs. OD6 Metals |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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