Correlation Between Sligro Food and Western Copper
Can any of the company-specific risk be diversified away by investing in both Sligro Food and Western 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 Sligro Food and Western Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sligro Food Group and Western Copper and, you can compare the effects of market volatilities on Sligro Food and Western 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 Sligro Food with a short position of Western Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and Western Copper.
Diversification Opportunities for Sligro Food and Western Copper
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sligro and Western is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and Western Copper and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Copper and Sligro Food 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 Sligro Food Group are associated (or correlated) with Western Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Copper has no effect on the direction of Sligro Food i.e., Sligro Food and Western Copper go up and down completely randomly.
Pair Corralation between Sligro Food and Western Copper
Assuming the 90 days horizon Sligro Food Group is expected to under-perform the Western Copper. But the pink sheet apears to be less risky and, when comparing its historical volatility, Sligro Food Group is 1.56 times less risky than Western Copper. The pink sheet trades about -0.15 of its potential returns per unit of risk. The Western Copper and is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 123.00 in Western Copper and on September 13, 2024 and sell it today you would lose (15.00) from holding Western Copper and or give up 12.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sligro Food Group vs. Western Copper and
Performance |
| Timeline |
| Sligro Food Group |
| Western Copper |
Sligro Food and Western Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and Western Copper
The main advantage of trading using opposite Sligro Food and Western Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, Western 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 Western Copper will offset losses from the drop in Western Copper's long position.| Sligro Food vs. Sapiens International | Sligro Food vs. Canlan Ice Sports | Sligro Food vs. Mattel Inc | Sligro Food vs. Playa Hotels Resorts |
| Western Copper vs. MP Materials Corp | Western Copper vs. NioCorp Developments Ltd | Western Copper vs. Vale SA ADR | Western Copper vs. Vizsla Resources Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |