Correlation Between Harbor Health and IShares Copper

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

By analyzing existing cross correlation between Harbor Health Care and iShares Copper and, you can compare the effects of market volatilities on Harbor Health and IShares Copper 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 Harbor Health with a short position of IShares Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbor Health and IShares Copper.

Diversification Opportunities for Harbor Health and IShares Copper

0.49

Correlation Coefficient

Harbor Health  IShares Copper

Very weak diversification

The 3 months correlation between Harbor and IShares is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Harbor Health Care and iShares Copper and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Copper and Harbor Health 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 Harbor Health Care are associated (or correlated) with IShares Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Copper has no effect on the direction of Harbor Health i.e., Harbor Health and IShares Copper go up and down completely randomly.

Pair Corralation between Harbor Health and IShares Copper

Given the investment horizon of 90 days Harbor Health Care is expected to under-perform the IShares Copper. But the etf apears to be less risky and, when comparing its historical volatility, Harbor Health Care is 1.87 times less risky than IShares Copper. The etf trades about -0.04 of its potential returns per unit of risk. The iShares Copper and is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,728  in iShares Copper and on September 2, 2024 and sell it today you would earn a total of  127.00  from holding iShares Copper and or generate 4.66% return on investment over 90 days.

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

Harbor Health Care  vs.  iShares Copper and

Harbor Health Care

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Harbor Health Care has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, Harbor Health is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

iShares Copper

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Copper and are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, IShares Copper is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Harbor Health and IShares Copper

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

The idea behind Harbor Health Care and iShares Copper and 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.

Check out your portfolio center.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.