Correlation Between Western Copper and ANDRADA MINING

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Can any of the company-specific risk be diversified away by investing in both Western Copper and ANDRADA MINING 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 ANDRADA MINING 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 ANDRADA MINING LTD, you can compare the effects of market volatilities on Western Copper and ANDRADA MINING 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 ANDRADA MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Copper and ANDRADA MINING.

Diversification Opportunities for Western Copper and ANDRADA MINING

-0.45
  Correlation Coefficient

Very good diversification

The 3 months correlation between Western and ANDRADA is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Western Copper and and ANDRADA MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANDRADA MINING LTD 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 ANDRADA MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANDRADA MINING LTD has no effect on the direction of Western Copper i.e., Western Copper and ANDRADA MINING go up and down completely randomly.

Pair Corralation between Western Copper and ANDRADA MINING

Assuming the 90 days trading horizon Western Copper and is expected to generate 0.95 times more return on investment than ANDRADA MINING. However, Western Copper and is 1.05 times less risky than ANDRADA MINING. It trades about 0.06 of its potential returns per unit of risk. ANDRADA MINING LTD is currently generating about 0.03 per unit of risk. If you would invest  98.00  in Western Copper and on April 23, 2025 and sell it today you would earn a total of  9.00  from holding Western Copper and or generate 9.18% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Western Copper and  vs.  ANDRADA MINING LTD

 Performance 
       Timeline  
Western Copper 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Western Copper and are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Western Copper may actually be approaching a critical reversion point that can send shares even higher in August 2025.
ANDRADA MINING LTD 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in ANDRADA MINING LTD are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, ANDRADA MINING is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Western Copper and ANDRADA MINING Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Western Copper and ANDRADA MINING

The main advantage of trading using opposite Western Copper and ANDRADA MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Copper position performs unexpectedly, ANDRADA MINING 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 ANDRADA MINING will offset losses from the drop in ANDRADA MINING's long position.
The idea behind Western Copper and and ANDRADA MINING LTD 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

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