Correlation Between Western Investment and Getty Copper
Can any of the company-specific risk be diversified away by investing in both Western Investment and Getty Copper 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 Western Investment and Getty Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Investment and Getty Copper, you can compare the effects of market volatilities on Western Investment and Getty Copper 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 Western Investment with a short position of Getty Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Investment and Getty Copper.
Diversification Opportunities for Western Investment and Getty Copper
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Getty is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Western Investment and Getty Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Copper and Western Investment 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 Western Investment are associated (or correlated) with Getty Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Copper has no effect on the direction of Western Investment i.e., Western Investment and Getty Copper go up and down completely randomly.
Pair Corralation between Western Investment and Getty Copper
Given the investment horizon of 90 days Western Investment is expected to under-perform the Getty Copper. But the stock apears to be less risky and, when comparing its historical volatility, Western Investment is 4.61 times less risky than Getty Copper. The stock trades about -0.04 of its potential returns per unit of risk. The Getty Copper is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Getty Copper on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Getty Copper or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Investment vs. Getty Copper
Performance |
| Timeline |
| Western Investment |
| Getty Copper |
Western Investment and Getty Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Investment and Getty Copper
The main advantage of trading using opposite Western Investment and Getty Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Investment position performs unexpectedly, Getty Copper 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 Getty Copper will offset losses from the drop in Getty Copper's long position.| Western Investment vs. Uniteds Limited | Western Investment vs. Economic Investment Trust | Western Investment vs. Clairvest Group | Western Investment vs. Cogeco Inc |
| Getty Copper vs. First Majestic Silver | Getty Copper vs. Ivanhoe Energy | Getty Copper vs. Flinders Resources Limited | Getty Copper vs. Orezone Gold 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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