Correlation Between Surge Copper and Baselode Energy
Can any of the company-specific risk be diversified away by investing in both Surge Copper and Baselode Energy 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 Baselode Energy 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 Baselode Energy Corp, you can compare the effects of market volatilities on Surge Copper and Baselode Energy 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 Baselode Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surge Copper and Baselode Energy.
Diversification Opportunities for Surge Copper and Baselode Energy
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Surge and Baselode is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and Baselode Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baselode Energy 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 Baselode Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baselode Energy Corp has no effect on the direction of Surge Copper i.e., Surge Copper and Baselode Energy go up and down completely randomly.
Pair Corralation between Surge Copper and Baselode Energy
Assuming the 90 days trading horizon Surge Copper Corp is expected to generate 1.22 times more return on investment than Baselode Energy. However, Surge Copper is 1.22 times more volatile than Baselode Energy Corp. It trades about -0.08 of its potential returns per unit of risk. Baselode Energy Corp is currently generating about -0.26 per unit of risk. If you would invest 11.00 in Surge Copper Corp on September 1, 2024 and sell it today you would lose (1.50) from holding Surge Copper Corp or give up 13.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surge Copper Corp vs. Baselode Energy Corp
Performance |
| Timeline |
| Surge Copper Corp |
| Baselode Energy Corp |
Surge Copper and Baselode Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surge Copper and Baselode Energy
The main advantage of trading using opposite Surge Copper and Baselode Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surge Copper position performs unexpectedly, Baselode Energy 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 Baselode Energy will offset losses from the drop in Baselode Energy's long position.| Surge Copper vs. Kutcho Copper Corp | Surge Copper vs. CANEX Metals | Surge Copper vs. Highland Copper | Surge Copper vs. District Copper Corp |
| Baselode Energy vs. MTY Food Group | Baselode Energy vs. Definity Financial Corp | Baselode Energy vs. CI Financial Corp | Baselode Energy vs. Renoworks Software |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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