Correlation Between Lundin Mining and CopperCorp Resources
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and CopperCorp 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 Lundin Mining and CopperCorp Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining and CopperCorp Resources, you can compare the effects of market volatilities on Lundin Mining and CopperCorp 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 Lundin Mining with a short position of CopperCorp Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and CopperCorp Resources.
Diversification Opportunities for Lundin Mining and CopperCorp Resources
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lundin and CopperCorp is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining and CopperCorp Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CopperCorp Resources and Lundin Mining 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 Lundin Mining are associated (or correlated) with CopperCorp Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CopperCorp Resources has no effect on the direction of Lundin Mining i.e., Lundin Mining and CopperCorp Resources go up and down completely randomly.
Pair Corralation between Lundin Mining and CopperCorp Resources
Assuming the 90 days horizon Lundin Mining is expected to generate 3.16 times less return on investment than CopperCorp Resources. But when comparing it to its historical volatility, Lundin Mining is 6.88 times less risky than CopperCorp Resources. It trades about 0.13 of its potential returns per unit of risk. CopperCorp Resources is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9.75 in CopperCorp Resources on August 25, 2024 and sell it today you would earn a total of 1.25 from holding CopperCorp Resources or generate 12.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 9.27% |
| Values | Daily Returns |
Lundin Mining vs. CopperCorp Resources
Performance |
| Timeline |
| Lundin Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| CopperCorp Resources |
Lundin Mining and CopperCorp Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and CopperCorp Resources
The main advantage of trading using opposite Lundin Mining and CopperCorp Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, CopperCorp 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 CopperCorp Resources will offset losses from the drop in CopperCorp Resources' long position.| Lundin Mining vs. Capstone Copper Corp | Lundin Mining vs. Hudbay Minerals | Lundin Mining vs. Copper Mountain Mining | Lundin Mining vs. Taseko Mines |
| CopperCorp Resources vs. Bell Copper | CopperCorp Resources vs. Copper Fox Metals | CopperCorp Resources vs. First Quantum Minerals | CopperCorp Resources vs. Southern Copper |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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