Correlation Between Kodiak Copper and Scottie Resources
Can any of the company-specific risk be diversified away by investing in both Kodiak Copper and Scottie Resources 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 Kodiak Copper and Scottie Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kodiak Copper Corp and Scottie Resources Corp, you can compare the effects of market volatilities on Kodiak Copper and Scottie Resources 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 Kodiak Copper with a short position of Scottie Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kodiak Copper and Scottie Resources.
Diversification Opportunities for Kodiak Copper and Scottie Resources
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kodiak and Scottie is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Kodiak Copper Corp and Scottie Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scottie Resources Corp and Kodiak 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 Kodiak Copper Corp are associated (or correlated) with Scottie Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scottie Resources Corp has no effect on the direction of Kodiak Copper i.e., Kodiak Copper and Scottie Resources go up and down completely randomly.
Pair Corralation between Kodiak Copper and Scottie Resources
Assuming the 90 days horizon Kodiak Copper Corp is expected to under-perform the Scottie Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Kodiak Copper Corp is 1.69 times less risky than Scottie Resources. The otc stock trades about -0.04 of its potential returns per unit of risk. The Scottie Resources Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Scottie Resources Corp on September 1, 2024 and sell it today you would lose (1.00) from holding Scottie Resources Corp or give up 7.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kodiak Copper Corp vs. Scottie Resources Corp
Performance |
| Timeline |
| Kodiak Copper Corp |
| Scottie Resources Corp |
Kodiak Copper and Scottie Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kodiak Copper and Scottie Resources
The main advantage of trading using opposite Kodiak Copper and Scottie Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kodiak Copper position performs unexpectedly, Scottie Resources 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 Scottie Resources will offset losses from the drop in Scottie Resources' long position.| Kodiak Copper vs. Defiance Silver Corp | Kodiak Copper vs. HUMANA INC | Kodiak Copper vs. SCOR PK | Kodiak Copper vs. Aquagold International |
| Scottie Resources vs. Defiance Silver Corp | Scottie Resources vs. HUMANA INC | Scottie Resources vs. SCOR PK | Scottie Resources vs. Aquagold International |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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