Correlation Between NYSE Composite and Copper Lake
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Copper Lake 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 NYSE Composite and Copper Lake into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Copper Lake Resources, you can compare the effects of market volatilities on NYSE Composite and Copper Lake 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 NYSE Composite with a short position of Copper Lake. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Copper Lake.
Diversification Opportunities for NYSE Composite and Copper Lake
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NYSE and Copper is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Copper Lake Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copper Lake Resources and NYSE Composite 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 NYSE Composite are associated (or correlated) with Copper Lake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copper Lake Resources has no effect on the direction of NYSE Composite i.e., NYSE Composite and Copper Lake go up and down completely randomly.
Pair Corralation between NYSE Composite and Copper Lake
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Copper Lake. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 103.7 times less risky than Copper Lake. The index trades about -0.22 of its potential returns per unit of risk. The Copper Lake Resources is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 0.75 in Copper Lake Resources on October 15, 2024 and sell it today you would lose (0.32) from holding Copper Lake Resources or give up 42.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
NYSE Composite vs. Copper Lake Resources
Performance |
| Timeline |
NYSE Composite and Copper Lake Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Copper Lake Resources
Pair trading matchups for Copper Lake
Pair Trading with NYSE Composite and Copper Lake
The main advantage of trading using opposite NYSE Composite and Copper Lake positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Copper Lake 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 Copper Lake will offset losses from the drop in Copper Lake's long position.| NYSE Composite vs. Biglari Holdings | NYSE Composite vs. Cheche Group Class | NYSE Composite vs. Cannae Holdings | NYSE Composite vs. Bowhead Specialty Holdings |
| Copper Lake vs. EMX Royalty Corp | Copper Lake vs. BHP Group Limited | Copper Lake vs. Vale SA ADR | Copper Lake vs. Rio Tinto ADR |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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