Correlation Between Copperbank Resources and Global Lights
Can any of the company-specific risk be diversified away by investing in both Copperbank Resources and Global Lights 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 Copperbank Resources and Global Lights into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Copperbank Resources Corp and Global Lights Acquisition, you can compare the effects of market volatilities on Copperbank Resources and Global Lights 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 Copperbank Resources with a short position of Global Lights. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copperbank Resources and Global Lights.
Diversification Opportunities for Copperbank Resources and Global Lights
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Copperbank and Global is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Copperbank Resources Corp and Global Lights Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Lights Acquisition and Copperbank 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 Copperbank Resources Corp are associated (or correlated) with Global Lights. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Lights Acquisition has no effect on the direction of Copperbank Resources i.e., Copperbank Resources and Global Lights go up and down completely randomly.
Pair Corralation between Copperbank Resources and Global Lights
Assuming the 90 days horizon Copperbank Resources Corp is expected to generate 24.72 times more return on investment than Global Lights. However, Copperbank Resources is 24.72 times more volatile than Global Lights Acquisition. It trades about 0.01 of its potential returns per unit of risk. Global Lights Acquisition is currently generating about 0.15 per unit of risk. If you would invest 61.00 in Copperbank Resources Corp on October 27, 2024 and sell it today you would lose (8.00) from holding Copperbank Resources Corp or give up 13.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 57.69% |
| Values | Daily Returns |
Copperbank Resources Corp vs. Global Lights Acquisition
Performance |
| Timeline |
| Copperbank Resources Corp |
| Global Lights Acquisition |
Copperbank Resources and Global Lights Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copperbank Resources and Global Lights
The main advantage of trading using opposite Copperbank Resources and Global Lights positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copperbank Resources position performs unexpectedly, Global Lights 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 Global Lights will offset losses from the drop in Global Lights' long position.| Copperbank Resources vs. Bell Copper | Copperbank Resources vs. Arizona Sonoran Copper | Copperbank Resources vs. CopperCorp Resources | Copperbank Resources vs. Copper Fox Metals |
| Global Lights vs. Weibo Corp | Global Lights vs. Getty Realty | Global Lights vs. Western Digital | Global Lights vs. BBB Foods |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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