Correlation Between Surge Copper and Nickel Mines
Can any of the company-specific risk be diversified away by investing in both Surge Copper and Nickel Mines 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 Nickel Mines 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 Nickel Mines Limited, you can compare the effects of market volatilities on Surge Copper and Nickel Mines 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 Nickel Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and Nickel Mines.
Diversification Opportunities for Surge Copper and Nickel Mines
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Surge and Nickel is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and Nickel Mines Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nickel Mines 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 Nickel Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nickel Mines Limited has no effect on the direction of Surge Copper i.e., Surge Copper and Nickel Mines go up and down completely randomly.
Pair Corralation between Surge Copper and Nickel Mines
Assuming the 90 days horizon Surge Copper Corp is expected to generate 1.32 times more return on investment than Nickel Mines. However, Surge Copper is 1.32 times more volatile than Nickel Mines Limited. It trades about 0.02 of its potential returns per unit of risk. Nickel Mines Limited is currently generating about 0.02 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 | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surge Copper Corp vs. Nickel Mines Limited
Performance |
| Timeline |
| Surge Copper Corp |
| Nickel Mines Limited |
Surge Copper and Nickel Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Copper and Nickel Mines
The main advantage of trading using opposite Surge Copper and Nickel Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, Nickel Mines 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 Nickel Mines will offset losses from the drop in Nickel Mines' long position.| Surge Copper vs. Rockridge Resources | Surge Copper vs. Ameriwest Lithium | Surge Copper vs. Osisko Metals Incorporated | Surge Copper vs. Volt Lithium Corp |
| Nickel Mines vs. IGO Limited | Nickel Mines vs. Qubec Nickel Corp | Nickel Mines vs. Mineral Resources Limited | Nickel Mines vs. Surge Copper 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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