Correlation Between National Bank and QC Copper
Can any of the company-specific risk be diversified away by investing in both National Bank and QC 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 National Bank and QC Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and QC Copper and, you can compare the effects of market volatilities on National Bank and QC 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 National Bank with a short position of QC Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and QC Copper.
Diversification Opportunities for National Bank and QC Copper
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between National and QCCU is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and QC Copper and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QC Copper and National Bank 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 National Bank of are associated (or correlated) with QC Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QC Copper has no effect on the direction of National Bank i.e., National Bank and QC Copper go up and down completely randomly.
Pair Corralation between National Bank and QC Copper
Assuming the 90 days trading horizon National Bank of is expected to generate 0.11 times more return on investment than QC Copper. However, National Bank of is 9.46 times less risky than QC Copper. It trades about 0.2 of its potential returns per unit of risk. QC Copper and is currently generating about -0.16 per unit of risk. If you would invest 2,365 in National Bank of on September 3, 2024 and sell it today you would earn a total of 44.00 from holding National Bank of or generate 1.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank of vs. QC Copper and
Performance |
| Timeline |
| National Bank |
| QC Copper |
National Bank and QC Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and QC Copper
The main advantage of trading using opposite National Bank and QC Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, QC 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 QC Copper will offset losses from the drop in QC Copper's long position.| National Bank vs. Cogeco Communications | National Bank vs. Economic Investment Trust | National Bank vs. Richelieu Hardware | National Bank vs. Renoworks Software |
| QC Copper vs. Algoma Steel Group | QC Copper vs. Champion Iron | QC Copper vs. International Zeolite Corp | QC Copper vs. European Residential Real |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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