Correlation Between Kopernik Global and Pear Tree

Can any of the company-specific risk be diversified away by investing in both Kopernik Global and Pear Tree 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 Kopernik Global and Pear Tree into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kopernik Global All Cap and Pear Tree Polaris, you can compare the effects of market volatilities on Kopernik Global and Pear Tree 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 Kopernik Global with a short position of Pear Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kopernik Global and Pear Tree.

Diversification Opportunities for Kopernik Global and Pear Tree

0.83

Correlation Coefficient

Kopernik Global  Pear Tree

Very poor diversification

The 3 months correlation between Kopernik and Pear is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kopernik Global All Cap and Pear Tree Polaris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pear Tree Polaris and Kopernik Global 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 Kopernik Global All Cap are associated (or correlated) with Pear Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pear Tree Polaris has no effect on the direction of Kopernik Global i.e., Kopernik Global and Pear Tree go up and down completely randomly.

Pair Corralation between Kopernik Global and Pear Tree

Assuming the 90 days horizon Kopernik Global All Cap is expected to generate 1.21 times more return on investment than Pear Tree. However, Kopernik Global is 1.21 times more volatile than Pear Tree Polaris. It trades about 0.25 of its potential returns per unit of risk. Pear Tree Polaris is currently generating about 0.22 per unit of risk. If you would invest  1,327  in Kopernik Global All Cap on May 6, 2025 and sell it today you would earn a total of  148.00  from holding Kopernik Global All Cap or generate 11.15% return on investment over 90 days.

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

Kopernik Global All Cap  vs.  Pear Tree Polaris

Kopernik Global All

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kopernik Global All Cap are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Kopernik Global may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pear Tree Polaris

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pear Tree Polaris are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Pear Tree may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Kopernik Global and Pear Tree

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

The idea behind Kopernik Global All Cap and Pear Tree Polaris 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.