Correlation Between Surge Copper and Decade Resources
Can any of the company-specific risk be diversified away by investing in both Surge Copper and Decade Resources 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 Surge Copper and Decade Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surge Copper Corp and Decade Resources, you can compare the effects of market volatilities on Surge Copper and Decade Resources 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 Surge Copper with a short position of Decade Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and Decade Resources.
Diversification Opportunities for Surge Copper and Decade Resources
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Surge and Decade is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and Decade Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Decade Resources and Surge Copper 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 Surge Copper Corp are associated (or correlated) with Decade Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Decade Resources has no effect on the direction of Surge Copper i.e., Surge Copper and Decade Resources go up and down completely randomly.
Pair Corralation between Surge Copper and Decade Resources
Assuming the 90 days horizon Surge Copper Corp is expected to generate 0.6 times more return on investment than Decade Resources. However, Surge Copper Corp is 1.68 times less risky than Decade Resources. It trades about 0.04 of its potential returns per unit of risk. Decade Resources is currently generating about -0.01 per unit of risk. If you would invest 6.29 in Surge Copper Corp on November 9, 2024 and sell it today you would earn a total of 1.01 from holding Surge Copper Corp or generate 16.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.26% |
| Values | Daily Returns |
Surge Copper Corp vs. Decade Resources
Performance |
| Timeline |
| Surge Copper Corp |
| Decade Resources |
Surge Copper and Decade Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Copper and Decade Resources
The main advantage of trading using opposite Surge Copper and Decade Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, Decade Resources 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 Decade Resources will offset losses from the drop in Decade Resources' long position.| Surge Copper vs. Commerce Resources Corp | Surge Copper vs. Great Western Minerals | Surge Copper vs. Silver Elephant Mining | Surge Copper vs. Eskay Mining Corp |
| Decade Resources vs. First American Silver | Decade Resources vs. Australian Vanadium Limited | Decade Resources vs. International Lithium Corp | Decade Resources vs. Wealth Minerals |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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