Correlation Between Red Cat and Kodiak Copper
Can any of the company-specific risk be diversified away by investing in both Red Cat and Kodiak 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 Red Cat and Kodiak Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Cat Holdings and Kodiak Copper Corp, you can compare the effects of market volatilities on Red Cat and Kodiak 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 Red Cat with a short position of Kodiak Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Cat and Kodiak Copper.
Diversification Opportunities for Red Cat and Kodiak Copper
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Red and Kodiak is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Red Cat Holdings and Kodiak Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kodiak Copper Corp and Red Cat 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 Red Cat Holdings are associated (or correlated) with Kodiak Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kodiak Copper Corp has no effect on the direction of Red Cat i.e., Red Cat and Kodiak Copper go up and down completely randomly.
Pair Corralation between Red Cat and Kodiak Copper
Given the investment horizon of 90 days Red Cat Holdings is expected to generate 3.09 times more return on investment than Kodiak Copper. However, Red Cat is 3.09 times more volatile than Kodiak Copper Corp. It trades about 0.63 of its potential returns per unit of risk. Kodiak Copper Corp is currently generating about -0.17 per unit of risk. If you would invest 269.00 in Red Cat Holdings on August 26, 2024 and sell it today you would earn a total of 628.00 from holding Red Cat Holdings or generate 233.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Cat Holdings vs. Kodiak Copper Corp
Performance |
| Timeline |
| Red Cat Holdings |
| Kodiak Copper Corp |
Red Cat and Kodiak Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Cat and Kodiak Copper
The main advantage of trading using opposite Red Cat and Kodiak Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Cat position performs unexpectedly, Kodiak 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 Kodiak Copper will offset losses from the drop in Kodiak Copper's long position.| Red Cat vs. Quantum Computing | Red Cat vs. Rigetti Computing | Red Cat vs. D Wave Quantum | Red Cat vs. AstroNova |
| Kodiak Copper vs. Morningstar Unconstrained Allocation | Kodiak Copper vs. High Yield Municipal Fund | Kodiak Copper vs. Knife River | Kodiak Copper vs. Klckner Co SE |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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