Correlation Between Capstone Copper and Copper Mountain
Can any of the company-specific risk be diversified away by investing in both Capstone Copper and Copper Mountain 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 Capstone Copper and Copper Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capstone Copper Corp and Copper Mountain Mining, you can compare the effects of market volatilities on Capstone Copper and Copper Mountain 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 Capstone Copper with a short position of Copper Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capstone Copper and Copper Mountain.
Diversification Opportunities for Capstone Copper and Copper Mountain
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Capstone and Copper is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Capstone Copper Corp and Copper Mountain Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copper Mountain Mining and Capstone Copper 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 Capstone Copper Corp are associated (or correlated) with Copper Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copper Mountain Mining has no effect on the direction of Capstone Copper i.e., Capstone Copper and Copper Mountain go up and down completely randomly.
Pair Corralation between Capstone Copper and Copper Mountain
Assuming the 90 days horizon Capstone Copper Corp is expected to generate 0.53 times more return on investment than Copper Mountain. However, Capstone Copper Corp is 1.87 times less risky than Copper Mountain. It trades about 0.03 of its potential returns per unit of risk. Copper Mountain Mining is currently generating about -0.22 per unit of risk. If you would invest 699.00 in Capstone Copper Corp on August 27, 2024 and sell it today you would earn a total of 6.00 from holding Capstone Copper Corp or generate 0.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capstone Copper Corp vs. Copper Mountain Mining
Performance |
| Timeline |
| Capstone Copper Corp |
| Copper Mountain Mining |
Capstone Copper and Copper Mountain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capstone Copper and Copper Mountain
The main advantage of trading using opposite Capstone Copper and Copper Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capstone Copper position performs unexpectedly, Copper Mountain 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 Copper Mountain will offset losses from the drop in Copper Mountain's long position.| Capstone Copper vs. Bell Copper | Capstone Copper vs. Copper Fox Metals | Capstone Copper vs. First Quantum Minerals | Capstone Copper vs. Southern Copper |
| Copper Mountain vs. Ascendant Resources | Copper Mountain vs. Cantex Mine Development | Copper Mountain vs. Amarc Resources | Copper Mountain vs. Sterling Metals 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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