Correlation Between Ion Beam and Impax Environmental
Can any of the company-specific risk be diversified away by investing in both Ion Beam and Impax Environmental 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 Ion Beam and Impax Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ion Beam Applications and Impax Environmental Markets, you can compare the effects of market volatilities on Ion Beam and Impax Environmental 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 Ion Beam with a short position of Impax Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ion Beam and Impax Environmental.
Diversification Opportunities for Ion Beam and Impax Environmental
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ion and Impax is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ion Beam Applications and Impax Environmental Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Environmental and Ion Beam 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 Ion Beam Applications are associated (or correlated) with Impax Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Environmental has no effect on the direction of Ion Beam i.e., Ion Beam and Impax Environmental go up and down completely randomly.
Pair Corralation between Ion Beam and Impax Environmental
Assuming the 90 days trading horizon Ion Beam is expected to generate 2.95 times less return on investment than Impax Environmental. In addition to that, Ion Beam is 2.17 times more volatile than Impax Environmental Markets. It trades about 0.08 of its total potential returns per unit of risk. Impax Environmental Markets is currently generating about 0.54 per unit of volatility. If you would invest 37,700 in Impax Environmental Markets on October 25, 2024 and sell it today you would earn a total of 3,300 from holding Impax Environmental Markets or generate 8.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ion Beam Applications vs. Impax Environmental Markets
Performance |
| Timeline |
| Ion Beam Applications |
| Impax Environmental |
Ion Beam and Impax Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ion Beam and Impax Environmental
The main advantage of trading using opposite Ion Beam and Impax Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ion Beam position performs unexpectedly, Impax Environmental 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 Impax Environmental will offset losses from the drop in Impax Environmental's long position.| Ion Beam vs. Batm Advanced Communications | Ion Beam vs. Qurate Retail Series | Ion Beam vs. Fonix Mobile plc | Ion Beam vs. Zegona Communications Plc |
| Impax Environmental vs. Teradata Corp | Impax Environmental vs. Fidelity National Information | Impax Environmental vs. Ion Beam Applications | Impax Environmental vs. Infrastrutture Wireless Italiane |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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