Correlation Between 88 Energy and Intermediate Capital
Can any of the company-specific risk be diversified away by investing in both 88 Energy and Intermediate Capital 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 88 Energy and Intermediate Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 88 Energy and Intermediate Capital Group, you can compare the effects of market volatilities on 88 Energy and Intermediate Capital 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 88 Energy with a short position of Intermediate Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of 88 Energy and Intermediate Capital.
Diversification Opportunities for 88 Energy and Intermediate Capital
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between 88E and Intermediate is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding 88 Energy and Intermediate Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Capital and 88 Energy 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 88 Energy are associated (or correlated) with Intermediate Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Capital has no effect on the direction of 88 Energy i.e., 88 Energy and Intermediate Capital go up and down completely randomly.
Pair Corralation between 88 Energy and Intermediate Capital
Assuming the 90 days trading horizon 88 Energy is expected to under-perform the Intermediate Capital. In addition to that, 88 Energy is 1.95 times more volatile than Intermediate Capital Group. It trades about -0.09 of its total potential returns per unit of risk. Intermediate Capital Group is currently generating about 0.01 per unit of volatility. If you would invest 213,069 in Intermediate Capital Group on September 3, 2024 and sell it today you would lose (1,269) from holding Intermediate Capital Group or give up 0.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
88 Energy vs. Intermediate Capital Group
Performance |
| Timeline |
| 88 Energy |
| Intermediate Capital |
88 Energy and Intermediate Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 88 Energy and Intermediate Capital
The main advantage of trading using opposite 88 Energy and Intermediate Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 88 Energy position performs unexpectedly, Intermediate Capital 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 Intermediate Capital will offset losses from the drop in Intermediate Capital's long position.| 88 Energy vs. Adriatic Metals | 88 Energy vs. Europa Metals | 88 Energy vs. Panther Metals PLC | 88 Energy vs. Young Cos Brewery |
| Intermediate Capital vs. SupplyMe Capital PLC | Intermediate Capital vs. 88 Energy | Intermediate Capital vs. Vodafone Group PLC | Intermediate Capital vs. Vodafone Group PLC |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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