Correlation Between Surge Copper and IGO
Can any of the company-specific risk be diversified away by investing in both Surge Copper and IGO 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 IGO 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 IGO Limited, you can compare the effects of market volatilities on Surge Copper and IGO 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 IGO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and IGO.
Diversification Opportunities for Surge Copper and IGO
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Surge and IGO is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and IGO Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGO Limited 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 IGO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGO Limited has no effect on the direction of Surge Copper i.e., Surge Copper and IGO go up and down completely randomly.
Pair Corralation between Surge Copper and IGO
Assuming the 90 days horizon Surge Copper Corp is expected to generate 1.72 times more return on investment than IGO. However, Surge Copper is 1.72 times more volatile than IGO Limited. It trades about 0.02 of its potential returns per unit of risk. IGO Limited is currently generating about -0.04 per unit of risk. If you would invest 9.39 in Surge Copper Corp on August 29, 2024 and sell it today you would lose (2.51) from holding Surge Copper Corp or give up 26.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surge Copper Corp vs. IGO Limited
Performance |
| Timeline |
| Surge Copper Corp |
| IGO Limited |
Surge Copper and IGO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Copper and IGO
The main advantage of trading using opposite Surge Copper and IGO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, IGO 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 IGO will offset losses from the drop in IGO's long position.| Surge Copper vs. Rockridge Resources | Surge Copper vs. Ameriwest Lithium | Surge Copper vs. Osisko Metals Incorporated | Surge Copper vs. Volt Lithium Corp |
| IGO vs. Rockridge Resources | IGO vs. Ameriwest Lithium | IGO vs. Osisko Metals Incorporated | IGO vs. Volt Lithium 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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