Correlation Between Lundin Mining and Ero Copper
Can any of the company-specific risk be diversified away by investing in both Lundin Mining and Ero 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 Lundin Mining and Ero Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Mining and Ero Copper Corp, you can compare the effects of market volatilities on Lundin Mining and Ero 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 Lundin Mining with a short position of Ero Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Mining and Ero Copper.
Diversification Opportunities for Lundin Mining and Ero Copper
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lundin and Ero is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Mining and Ero Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ero Copper Corp 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 Ero Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ero Copper Corp has no effect on the direction of Lundin Mining i.e., Lundin Mining and Ero Copper go up and down completely randomly.
Pair Corralation between Lundin Mining and Ero Copper
If you would invest 712.00 in Lundin Mining on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Lundin Mining or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Lundin Mining vs. Ero Copper Corp
Performance |
| Timeline |
| Lundin Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ero Copper Corp |
Lundin Mining and Ero Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Mining and Ero Copper
The main advantage of trading using opposite Lundin Mining and Ero Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Mining position performs unexpectedly, Ero 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 Ero Copper will offset losses from the drop in Ero Copper's long position.| Lundin Mining vs. Capstone Copper Corp | Lundin Mining vs. Hudbay Minerals | Lundin Mining vs. Copper Mountain Mining | Lundin Mining vs. Taseko Mines |
| Ero Copper vs. Freeport McMoran Copper Gold | Ero Copper vs. Amerigo Resources | Ero Copper vs. Hudbay Minerals | Ero Copper vs. Capstone 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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