Correlation Between Western Copper and WildBrain
Can any of the company-specific risk be diversified away by investing in both Western Copper and WildBrain 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 Copper and WildBrain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Copper and and WildBrain, you can compare the effects of market volatilities on Western Copper and WildBrain 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 Copper with a short position of WildBrain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Copper and WildBrain.
Diversification Opportunities for Western Copper and WildBrain
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Western and WildBrain is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Western Copper and and WildBrain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WildBrain and Western 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 Western Copper and are associated (or correlated) with WildBrain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WildBrain has no effect on the direction of Western Copper i.e., Western Copper and WildBrain go up and down completely randomly.
Pair Corralation between Western Copper and WildBrain
Assuming the 90 days trading horizon Western Copper and is expected to generate 0.71 times more return on investment than WildBrain. However, Western Copper and is 1.41 times less risky than WildBrain. It trades about -0.01 of its potential returns per unit of risk. WildBrain is currently generating about -0.03 per unit of risk. If you would invest 234.00 in Western Copper and on August 29, 2024 and sell it today you would lose (77.00) from holding Western Copper and or give up 32.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Copper and vs. WildBrain
Performance |
| Timeline |
| Western Copper |
| WildBrain |
Western Copper and WildBrain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Copper and WildBrain
The main advantage of trading using opposite Western Copper and WildBrain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Copper position performs unexpectedly, WildBrain 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 WildBrain will offset losses from the drop in WildBrain's long position.| Western Copper vs. First Majestic Silver | Western Copper vs. Ivanhoe Energy | Western Copper vs. Orezone Gold Corp | Western Copper vs. Faraday Copper Corp |
| WildBrain vs. Maple Leaf Foods | WildBrain vs. Western Copper and | WildBrain vs. Rubicon Organics | WildBrain vs. Lion One Metals |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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