Correlation Between Surge Copper and Rockridge Resources
Can any of the company-specific risk be diversified away by investing in both Surge Copper and Rockridge 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 Rockridge 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 Rockridge Resources, you can compare the effects of market volatilities on Surge Copper and Rockridge 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 Rockridge Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and Rockridge Resources.
Diversification Opportunities for Surge Copper and Rockridge Resources
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Surge and Rockridge is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and Rockridge Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rockridge 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 Rockridge Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rockridge Resources has no effect on the direction of Surge Copper i.e., Surge Copper and Rockridge Resources go up and down completely randomly.
Pair Corralation between Surge Copper and Rockridge Resources
Assuming the 90 days horizon Surge Copper Corp is expected to generate 0.68 times more return on investment than Rockridge Resources. However, Surge Copper Corp is 1.47 times less risky than Rockridge Resources. It trades about -0.12 of its potential returns per unit of risk. Rockridge Resources is currently generating about -0.11 per unit of risk. If you would invest 8.46 in Surge Copper Corp on August 29, 2024 and sell it today you would lose (1.58) from holding Surge Copper Corp or give up 18.68% 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. Rockridge Resources
Performance |
| Timeline |
| Surge Copper Corp |
| Rockridge Resources |
Surge Copper and Rockridge Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Copper and Rockridge Resources
The main advantage of trading using opposite Surge Copper and Rockridge Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, Rockridge 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 Rockridge Resources will offset losses from the drop in Rockridge Resources' long position.| Surge Copper vs. Rockridge Resources | Surge Copper vs. Ameriwest Lithium | Surge Copper vs. Osisko Metals Incorporated | Surge Copper vs. Volt Lithium Corp |
| Rockridge Resources vs. Ameriwest Lithium | Rockridge Resources vs. Osisko Metals Incorporated | Rockridge Resources 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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