Correlation Between Copper Mountain and Antofagasta PLC
Can any of the company-specific risk be diversified away by investing in both Copper Mountain and Antofagasta PLC 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 Copper Mountain and Antofagasta PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Copper Mountain Mining and Antofagasta PLC, you can compare the effects of market volatilities on Copper Mountain and Antofagasta PLC 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 Copper Mountain with a short position of Antofagasta PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copper Mountain and Antofagasta PLC.
Diversification Opportunities for Copper Mountain and Antofagasta PLC
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Copper and Antofagasta is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Copper Mountain Mining and Antofagasta PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antofagasta PLC and Copper Mountain 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 Copper Mountain Mining are associated (or correlated) with Antofagasta PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antofagasta PLC has no effect on the direction of Copper Mountain i.e., Copper Mountain and Antofagasta PLC go up and down completely randomly.
Pair Corralation between Copper Mountain and Antofagasta PLC
Assuming the 90 days horizon Copper Mountain Mining is expected to generate 42.7 times more return on investment than Antofagasta PLC. However, Copper Mountain is 42.7 times more volatile than Antofagasta PLC. It trades about 0.15 of its potential returns per unit of risk. Antofagasta PLC is currently generating about 0.04 per unit of risk. If you would invest 134.00 in Copper Mountain Mining on August 25, 2024 and sell it today you would lose (111.00) from holding Copper Mountain Mining or give up 82.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 92.4% |
| Values | Daily Returns |
Copper Mountain Mining vs. Antofagasta PLC
Performance |
| Timeline |
| Copper Mountain Mining |
| Antofagasta PLC |
Copper Mountain and Antofagasta PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copper Mountain and Antofagasta PLC
The main advantage of trading using opposite Copper Mountain and Antofagasta PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copper Mountain position performs unexpectedly, Antofagasta PLC 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 Antofagasta PLC will offset losses from the drop in Antofagasta PLC's long position.| Copper Mountain vs. Ero Copper Corp | Copper Mountain vs. Copper Fox Metals | Copper Mountain vs. First Quantum Minerals | Copper Mountain vs. Hudbay Minerals |
| Antofagasta PLC vs. Bell Copper | Antofagasta PLC vs. Arizona Sonoran Copper | Antofagasta PLC vs. Dor Copper Mining | Antofagasta PLC vs. CopperCorp Resources |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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