Correlation Between Copper Lake and Canfor Pulp

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

By analyzing existing cross correlation between Copper Lake Resources and Canfor Pulp Products, you can compare the effects of market volatilities on Copper Lake and Canfor Pulp 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 Copper Lake with a short position of Canfor Pulp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copper Lake and Canfor Pulp.

Diversification Opportunities for Copper Lake and Canfor Pulp

-0.63

Correlation Coefficient

Copper Lake  Canfor Pulp

Excellent diversification

The 3 months correlation between Copper and Canfor is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Copper Lake Resources and Canfor Pulp Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canfor Pulp Products and Copper Lake 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 Copper Lake Resources are associated (or correlated) with Canfor Pulp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canfor Pulp Products has no effect on the direction of Copper Lake i.e., Copper Lake and Canfor Pulp go up and down completely randomly.

Pair Corralation between Copper Lake and Canfor Pulp

Assuming the 90 days horizon Copper Lake Resources is expected to generate 5.91 times more return on investment than Canfor Pulp. However, Copper Lake is 5.91 times more volatile than Canfor Pulp Products. It trades about 0.17 of its potential returns per unit of risk. Canfor Pulp Products is currently generating about -0.12 per unit of risk. If you would invest  1.00  in Copper Lake Resources on August 20, 2025 and sell it today you would earn a total of  1.50  from holding Copper Lake Resources or generate 150.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Copper Lake Resources  vs.  Canfor Pulp Products

Copper Lake Resources

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Copper Lake Resources are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Copper Lake showed solid returns over the last few months and may actually be approaching a breakup point.

Canfor Pulp Products

Risk-Adjusted Performance

Weakest

Over the last 90 days Canfor Pulp Products has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in December 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Copper Lake and Canfor Pulp

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

The idea behind Copper Lake Resources and Canfor Pulp Products 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.