Correlation Between Surge Copper and Québec Nickel

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Can any of the company-specific risk be diversified away by investing in both Surge Copper and Québec Nickel 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 Québec Nickel 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 Qubec Nickel Corp, you can compare the effects of market volatilities on Surge Copper and Québec Nickel 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 Québec Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and Québec Nickel.

Diversification Opportunities for Surge Copper and Québec Nickel

SurgeQuébecDiversified AwaySurgeQuébecDiversified Away100%
-0.2
  Correlation Coefficient

Good diversification

The 3 months correlation between Surge and Québec is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and Qubec Nickel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qubec Nickel Corp 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 Québec Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qubec Nickel Corp has no effect on the direction of Surge Copper i.e., Surge Copper and Québec Nickel go up and down completely randomly.

Pair Corralation between Surge Copper and Québec Nickel

Assuming the 90 days horizon Surge Copper Corp is expected to generate 0.36 times more return on investment than Québec Nickel. However, Surge Copper Corp is 2.8 times less risky than Québec Nickel. It trades about 0.08 of its potential returns per unit of risk. Qubec Nickel Corp is currently generating about -0.3 per unit of risk. If you would invest  6.63  in Surge Copper Corp on November 27, 2024 and sell it today you would earn a total of  0.32  from holding Surge Copper Corp or generate 4.83% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.24%
ValuesDaily Returns

Surge Copper Corp  vs.  Qubec Nickel Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 0200400600800
JavaScript chart by amCharts 3.21.15SRGXF QNICF
       Timeline  
Surge Copper Corp 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Surge Copper Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Surge Copper may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.060.0650.070.0750.080.085
Qubec Nickel Corp 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Qubec Nickel Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak fundamental indicators, Québec Nickel reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.020.040.060.080.10.120.140.16

Surge Copper and Québec Nickel Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.76-5.06-3.37-1.67-0.0281.633.314.996.678.35 0.0050.0100.0150.020
JavaScript chart by amCharts 3.21.15SRGXF QNICF
       Returns  

Pair Trading with Surge Copper and Québec Nickel

The main advantage of trading using opposite Surge Copper and Québec Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, Québec Nickel 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 Québec Nickel will offset losses from the drop in Québec Nickel's long position.
The idea behind Surge Copper Corp and Qubec Nickel Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

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