Correlation Between Imperial Metals and Southern Copper
Can any of the company-specific risk be diversified away by investing in both Imperial Metals and Southern Copper 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 Imperial Metals and Southern Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imperial Metals and Southern Copper, you can compare the effects of market volatilities on Imperial Metals and Southern Copper 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 Imperial Metals with a short position of Southern Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imperial Metals and Southern Copper.
Diversification Opportunities for Imperial Metals and Southern Copper
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Imperial and Southern is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Imperial Metals and Southern Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Copper and Imperial Metals 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 Imperial Metals are associated (or correlated) with Southern Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Copper has no effect on the direction of Imperial Metals i.e., Imperial Metals and Southern Copper go up and down completely randomly.
Pair Corralation between Imperial Metals and Southern Copper
If you would invest 8,904 in Southern Copper on October 20, 2024 and sell it today you would earn a total of 550.00 from holding Southern Copper or generate 6.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Imperial Metals vs. Southern Copper
Performance |
| Timeline |
| Imperial Metals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Southern Copper |
Imperial Metals and Southern Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imperial Metals and Southern Copper
The main advantage of trading using opposite Imperial Metals and Southern Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imperial Metals position performs unexpectedly, Southern Copper 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 Southern Copper will offset losses from the drop in Southern Copper's long position.| Imperial Metals vs. ANTA SPORTS PRODUCT | Imperial Metals vs. Mitsubishi Materials | Imperial Metals vs. The Yokohama Rubber | Imperial Metals vs. Flutter Entertainment PLC |
| Southern Copper vs. Tencent Music Entertainment | Southern Copper vs. Gol Intelligent Airlines | Southern Copper vs. Warner Music Group | Southern Copper vs. Aegean Airlines SA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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