Correlation Between WM Technology and Southern Copper
Can any of the company-specific risk be diversified away by investing in both WM Technology and Southern 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 WM Technology and Southern Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WM Technology and Southern Copper, you can compare the effects of market volatilities on WM Technology and Southern 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 WM Technology with a short position of Southern Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of WM Technology and Southern Copper.
Diversification Opportunities for WM Technology and Southern Copper
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAPSW and Southern is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding WM Technology and Southern Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Copper and WM Technology 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 WM Technology are associated (or correlated) with Southern Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Copper has no effect on the direction of WM Technology i.e., WM Technology and Southern Copper go up and down completely randomly.
Pair Corralation between WM Technology and Southern Copper
Assuming the 90 days horizon WM Technology is expected to under-perform the Southern Copper. In addition to that, WM Technology is 5.18 times more volatile than Southern Copper. It trades about -0.02 of its total potential returns per unit of risk. Southern Copper is currently generating about 0.2 per unit of volatility. If you would invest 9,937 in Southern Copper on September 4, 2025 and sell it today you would earn a total of 3,553 from holding Southern Copper or generate 35.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.83% |
| Values | Daily Returns |
WM Technology vs. Southern Copper
Performance |
| Timeline |
| WM Technology |
| Southern Copper |
WM Technology and Southern Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WM Technology and Southern Copper
The main advantage of trading using opposite WM Technology and Southern Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WM Technology position performs unexpectedly, Southern 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 Southern Copper will offset losses from the drop in Southern Copper's long position.| WM Technology vs. Sumitomo Chemical Co | WM Technology vs. Dongjiang Environmental | WM Technology vs. X FAB Silicon Foundries | WM Technology vs. AeroVironment |
| Southern Copper vs. Eastman Chemical | Southern Copper vs. Bridgford Foods | Southern Copper vs. Mitsui Chemicals ADR | Southern Copper vs. Nissan Chemical |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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