Correlation Between Surge Battery and American CuMo
Can any of the company-specific risk be diversified away by investing in both Surge Battery and American CuMo 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 Surge Battery and American CuMo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surge Battery Metals and American CuMo Mining, you can compare the effects of market volatilities on Surge Battery and American CuMo 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 Surge Battery with a short position of American CuMo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Battery and American CuMo.
Diversification Opportunities for Surge Battery and American CuMo
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Surge and American is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Surge Battery Metals and American CuMo Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American CuMo Mining and Surge Battery 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 Surge Battery Metals are associated (or correlated) with American CuMo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American CuMo Mining has no effect on the direction of Surge Battery i.e., Surge Battery and American CuMo go up and down completely randomly.
Pair Corralation between Surge Battery and American CuMo
Assuming the 90 days horizon Surge Battery is expected to generate 11.22 times less return on investment than American CuMo. But when comparing it to its historical volatility, Surge Battery Metals is 3.91 times less risky than American CuMo. It trades about 0.03 of its potential returns per unit of risk. American CuMo Mining is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1.00 in American CuMo Mining on September 3, 2024 and sell it today you would earn a total of 0.00 from holding American CuMo Mining or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Surge Battery Metals vs. American CuMo Mining
Performance |
| Timeline |
| Surge Battery Metals |
| American CuMo Mining |
Surge Battery and American CuMo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Battery and American CuMo
The main advantage of trading using opposite Surge Battery and American CuMo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Battery position performs unexpectedly, American CuMo 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 American CuMo will offset losses from the drop in American CuMo's long position.| Surge Battery vs. Nevada Sunrise Gold | Surge Battery vs. Critical Elements | Surge Battery vs. Lithium Ionic Corp | Surge Battery vs. Green Technology Metals |
| American CuMo vs. Advantage Solutions | American CuMo vs. Atlas Corp | American CuMo vs. PureCycle Technologies | American CuMo vs. WM Technology |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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