Correlation Between PJX Resources and Chakana Copper
Can any of the company-specific risk be diversified away by investing in both PJX Resources and Chakana 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 PJX Resources and Chakana Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJX Resources and Chakana Copper Corp, you can compare the effects of market volatilities on PJX Resources and Chakana 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 PJX Resources with a short position of Chakana Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJX Resources and Chakana Copper.
Diversification Opportunities for PJX Resources and Chakana Copper
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PJX and Chakana is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding PJX Resources and Chakana Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chakana Copper Corp and PJX Resources 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 PJX Resources are associated (or correlated) with Chakana Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chakana Copper Corp has no effect on the direction of PJX Resources i.e., PJX Resources and Chakana Copper go up and down completely randomly.
Pair Corralation between PJX Resources and Chakana Copper
Assuming the 90 days horizon PJX Resources is expected to generate 0.93 times more return on investment than Chakana Copper. However, PJX Resources is 1.07 times less risky than Chakana Copper. It trades about 0.04 of its potential returns per unit of risk. Chakana Copper Corp is currently generating about 0.02 per unit of risk. If you would invest 9.00 in PJX Resources on September 12, 2024 and sell it today you would earn a total of 0.50 from holding PJX Resources or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJX Resources vs. Chakana Copper Corp
Performance |
| Timeline |
| PJX Resources |
| Chakana Copper Corp |
PJX Resources and Chakana Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJX Resources and Chakana Copper
The main advantage of trading using opposite PJX Resources and Chakana Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJX Resources position performs unexpectedly, Chakana 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 Chakana Copper will offset losses from the drop in Chakana Copper's long position.| PJX Resources vs. Ressources Minieres Radisson | PJX Resources vs. Galantas Gold Corp | PJX Resources vs. Red Pine Exploration | PJX Resources vs. Kore Mining |
| Chakana Copper vs. Libero Copper Corp | Chakana Copper vs. Scottie Resources Corp | Chakana Copper vs. PJX Resources | Chakana Copper vs. Rugby Mining Limited |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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