Correlation Between Aftermath Silver and IGO
Can any of the company-specific risk be diversified away by investing in both Aftermath Silver and IGO 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 Aftermath Silver and IGO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aftermath Silver and IGO Limited, you can compare the effects of market volatilities on Aftermath Silver and IGO 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 Aftermath Silver with a short position of IGO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aftermath Silver and IGO.
Diversification Opportunities for Aftermath Silver and IGO
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aftermath and IGO is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Aftermath Silver and IGO Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGO Limited and Aftermath Silver 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 Aftermath Silver are associated (or correlated) with IGO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGO Limited has no effect on the direction of Aftermath Silver i.e., Aftermath Silver and IGO go up and down completely randomly.
Pair Corralation between Aftermath Silver and IGO
Assuming the 90 days horizon Aftermath Silver is expected to generate 4.41 times more return on investment than IGO. However, Aftermath Silver is 4.41 times more volatile than IGO Limited. It trades about 0.01 of its potential returns per unit of risk. IGO Limited is currently generating about 0.03 per unit of risk. If you would invest 34.00 in Aftermath Silver on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Aftermath Silver or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Aftermath Silver vs. IGO Limited
Performance |
| Timeline |
| Aftermath Silver |
| IGO Limited |
Aftermath Silver and IGO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aftermath Silver and IGO
The main advantage of trading using opposite Aftermath Silver and IGO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aftermath Silver position performs unexpectedly, IGO 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 IGO will offset losses from the drop in IGO's long position.| Aftermath Silver vs. Ascendant Resources | Aftermath Silver vs. Nevada King Gold | Aftermath Silver vs. Fathom Nickel | Aftermath Silver vs. Wallbridge Mining |
| IGO vs. Grid Metals Corp | IGO vs. First American Silver | IGO vs. Qubec Nickel Corp | IGO vs. Lithium Australia NL |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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