Correlation Between Ross Stores and Southern Copper
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Southern 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 Ross Stores and Southern Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Southern Copper, you can compare the effects of market volatilities on Ross Stores and Southern 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 Ross Stores with a short position of Southern Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Southern Copper.
Diversification Opportunities for Ross Stores and Southern Copper
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ross and Southern is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Southern Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Copper and Ross Stores 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 Ross Stores are associated (or correlated) with Southern Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Copper has no effect on the direction of Ross Stores i.e., Ross Stores and Southern Copper go up and down completely randomly.
Pair Corralation between Ross Stores and Southern Copper
Assuming the 90 days trading horizon Ross Stores is expected to generate 1.44 times more return on investment than Southern Copper. However, Ross Stores is 1.44 times more volatile than Southern Copper. It trades about 0.08 of its potential returns per unit of risk. Southern Copper is currently generating about 0.05 per unit of risk. If you would invest 301,000 in Ross Stores on August 31, 2024 and sell it today you would earn a total of 11,485 from holding Ross Stores or generate 3.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 36.07% |
| Values | Daily Returns |
Ross Stores vs. Southern Copper
Performance |
| Timeline |
| Ross Stores |
| Southern Copper |
Ross Stores and Southern Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Southern Copper
The main advantage of trading using opposite Ross Stores and Southern Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Southern 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 Southern Copper will offset losses from the drop in Southern Copper's long position.| Ross Stores vs. KB Home | Ross Stores vs. Grupo Sports World | Ross Stores vs. The Bank of | Ross Stores vs. Hoteles City Express |
| Southern Copper vs. Deutsche Bank Aktiengesellschaft | Southern Copper vs. FIBRA Storage | Southern Copper vs. McEwen Mining | Southern Copper vs. Ross Stores |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |