Correlation Between Kopernik Global and Brandes International
Can any of the company-specific risk be diversified away by investing in both Kopernik Global and Brandes International 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 Kopernik Global and Brandes International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kopernik Global All Cap and Brandes International Small, you can compare the effects of market volatilities on Kopernik Global and Brandes International 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 Kopernik Global with a short position of Brandes International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kopernik Global and Brandes International.
Diversification Opportunities for Kopernik Global and Brandes International
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kopernik and Brandes is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kopernik Global All Cap and Brandes International Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandes International and Kopernik Global 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 Kopernik Global All Cap are associated (or correlated) with Brandes International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandes International has no effect on the direction of Kopernik Global i.e., Kopernik Global and Brandes International go up and down completely randomly.
Pair Corralation between Kopernik Global and Brandes International
Assuming the 90 days horizon Kopernik Global is expected to generate 3.32 times less return on investment than Brandes International. But when comparing it to its historical volatility, Kopernik Global All Cap is 1.03 times less risky than Brandes International. It trades about 0.04 of its potential returns per unit of risk. Brandes International Small is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,167 in Brandes International Small on November 28, 2024 and sell it today you would earn a total of 741.00 from holding Brandes International Small or generate 63.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kopernik Global All Cap vs. Brandes International Small
Performance |
| Timeline |
| Kopernik Global All |
| Brandes International |
Kopernik Global and Brandes International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kopernik Global and Brandes International
The main advantage of trading using opposite Kopernik Global and Brandes International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kopernik Global position performs unexpectedly, Brandes International 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 Brandes International will offset losses from the drop in Brandes International's long position.| Kopernik Global vs. Tax Managed International Equity | Kopernik Global vs. Nationwide E Plus | Kopernik Global vs. Rationalrgn Hedged Equity | Kopernik Global vs. T Rowe Price |
| Brandes International vs. Ultra Short Fixed Income | Brandes International vs. T Rowe Price | Brandes International vs. Qs International Equity | Brandes International vs. Artisan Select Equity |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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