Correlation Between Southern Copper and EJF Investments

Can any of the company-specific risk be diversified away by investing in both Southern Copper and EJF Investments 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 Southern Copper and EJF Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Southern Copper Corp and EJF Investments, you can compare the effects of market volatilities on Southern Copper and EJF Investments 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 Southern Copper with a short position of EJF Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Copper and EJF Investments.

Diversification Opportunities for Southern Copper and EJF Investments

0.8

Correlation Coefficient

Southern Copper  EJF Investments

Very poor diversification

The 3 months correlation between Southern and EJF is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Southern Copper Corp and EJF Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EJF Investments and Southern 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 Southern Copper Corp are associated (or correlated) with EJF Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EJF Investments has no effect on the direction of Southern Copper i.e., Southern Copper and EJF Investments go up and down completely randomly.

Pair Corralation between Southern Copper and EJF Investments

Assuming the 90 days trading horizon Southern Copper Corp is expected to generate 9.23 times more return on investment than EJF Investments. However, Southern Copper is 9.23 times more volatile than EJF Investments. It trades about 0.07 of its potential returns per unit of risk. EJF Investments is currently generating about 0.36 per unit of risk. If you would invest  9,190  in Southern Copper Corp on April 25, 2025 and sell it today you would earn a total of  780.00  from holding Southern Copper Corp or generate 8.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Southern Copper Corp  vs.  EJF Investments

Southern Copper Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Southern Copper Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Southern Copper may actually be approaching a critical reversion point that can send shares even higher in August 2025.

EJF Investments

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in EJF Investments are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, EJF Investments is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Southern Copper and EJF Investments

The main advantage of trading using opposite Southern Copper and EJF Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Copper position performs unexpectedly, EJF Investments 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 EJF Investments will offset losses from the drop in EJF Investments' long position.

The idea behind Southern Copper Corp and EJF Investments pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.