Correlation Between Surge Copper and China Molybdenum

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

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

Diversification Opportunities for Surge Copper and China Molybdenum

0.77

Correlation Coefficient

Surge Copper  China Molybdenum

Poor diversification

The 3 months correlation between Surge and China is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Surge Copper Corp and China Molybdenum Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Molybdenum and Surge 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 Surge Copper Corp are associated (or correlated) with China Molybdenum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Molybdenum has no effect on the direction of Surge Copper i.e., Surge Copper and China Molybdenum go up and down completely randomly.

Pair Corralation between Surge Copper and China Molybdenum

Assuming the 90 days horizon Surge Copper is expected to generate 1.02 times less return on investment than China Molybdenum. In addition to that, Surge Copper is 1.18 times more volatile than China Molybdenum Co. It trades about 0.14 of its total potential returns per unit of risk. China Molybdenum Co is currently generating about 0.16 per unit of volatility. If you would invest  77.00  in China Molybdenum Co on May 6, 2025 and sell it today you would earn a total of  41.00  from holding China Molybdenum Co or generate 53.25% return on investment over 90 days.

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

Surge Copper Corp  vs.  China Molybdenum Co

Surge Copper Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Surge Copper Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Surge Copper reported solid returns over the last few months and may actually be approaching a breakup point.

China Molybdenum

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in China Molybdenum Co are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, China Molybdenum reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Surge Copper and China Molybdenum

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

The idea behind Surge Copper Corp and China Molybdenum Co 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.