Correlation Between Western Copper and Aftermath Silver
Can any of the company-specific risk be diversified away by investing in both Western Copper and Aftermath Silver 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 Aftermath Silver 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 Aftermath Silver, you can compare the effects of market volatilities on Western Copper and Aftermath Silver 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 Aftermath Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Copper and Aftermath Silver.
Diversification Opportunities for Western Copper and Aftermath Silver
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Western and Aftermath is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Western Copper and and Aftermath Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aftermath Silver 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 Aftermath Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aftermath Silver has no effect on the direction of Western Copper i.e., Western Copper and Aftermath Silver go up and down completely randomly.
Pair Corralation between Western Copper and Aftermath Silver
Considering the 90-day investment horizon Western Copper and is expected to under-perform the Aftermath Silver. But the stock apears to be less risky and, when comparing its historical volatility, Western Copper and is 1.99 times less risky than Aftermath Silver. The stock trades about -0.01 of its potential returns per unit of risk. The Aftermath Silver is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Aftermath Silver on August 28, 2024 and sell it today you would earn a total of 8.00 from holding Aftermath Silver or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Copper and vs. Aftermath Silver
Performance |
| Timeline |
| Western Copper |
| Aftermath Silver |
Western Copper and Aftermath Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Copper and Aftermath Silver
The main advantage of trading using opposite Western Copper and Aftermath Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Copper position performs unexpectedly, Aftermath Silver 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 Aftermath Silver will offset losses from the drop in Aftermath Silver's long position.| Western Copper vs. Fury Gold Mines | Western Copper vs. EMX Royalty Corp | Western Copper vs. Nevada King Gold | Western Copper vs. Aftermath Silver |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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