Correlation Between Faraday Copper and Excelsior Mining
Can any of the company-specific risk be diversified away by investing in both Faraday Copper and Excelsior Mining 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 Faraday Copper and Excelsior Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Faraday Copper Corp and Excelsior Mining Corp, you can compare the effects of market volatilities on Faraday Copper and Excelsior Mining 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 Faraday Copper with a short position of Excelsior Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Faraday Copper and Excelsior Mining.
Diversification Opportunities for Faraday Copper and Excelsior Mining
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Faraday and Excelsior is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Faraday Copper Corp and Excelsior Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excelsior Mining Corp and Faraday 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 Faraday Copper Corp are associated (or correlated) with Excelsior Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excelsior Mining Corp has no effect on the direction of Faraday Copper i.e., Faraday Copper and Excelsior Mining go up and down completely randomly.
Pair Corralation between Faraday Copper and Excelsior Mining
Assuming the 90 days trading horizon Faraday Copper Corp is expected to under-perform the Excelsior Mining. But the stock apears to be less risky and, when comparing its historical volatility, Faraday Copper Corp is 4.16 times less risky than Excelsior Mining. The stock trades about -0.32 of its potential returns per unit of risk. The Excelsior Mining Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Excelsior Mining Corp on September 13, 2024 and sell it today you would earn a total of 5.00 from holding Excelsior Mining Corp or generate 35.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Faraday Copper Corp vs. Excelsior Mining Corp
Performance |
| Timeline |
| Faraday Copper Corp |
| Excelsior Mining Corp |
Faraday Copper and Excelsior Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Faraday Copper and Excelsior Mining
The main advantage of trading using opposite Faraday Copper and Excelsior Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Faraday Copper position performs unexpectedly, Excelsior Mining 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 Excelsior Mining will offset losses from the drop in Excelsior Mining's long position.| Faraday Copper vs. Arizona Sonoran Copper | Faraday Copper vs. Marimaca Copper Corp | Faraday Copper vs. World Copper | Faraday Copper vs. QC Copper and |
| Excelsior Mining vs. Ivanhoe Energy | Excelsior Mining vs. Orezone Gold Corp | Excelsior Mining vs. Faraday Copper 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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