Correlation Between IShares Fundamental and Ivanhoe Mines
Can any of the company-specific risk be diversified away by investing in both IShares Fundamental and Ivanhoe Mines 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 IShares Fundamental and Ivanhoe Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Fundamental Hedged and Ivanhoe Mines, you can compare the effects of market volatilities on IShares Fundamental and Ivanhoe Mines 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 IShares Fundamental with a short position of Ivanhoe Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Fundamental and Ivanhoe Mines.
Diversification Opportunities for IShares Fundamental and Ivanhoe Mines
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and Ivanhoe is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding iShares Fundamental Hedged and Ivanhoe Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivanhoe Mines and IShares Fundamental 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 iShares Fundamental Hedged are associated (or correlated) with Ivanhoe Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivanhoe Mines has no effect on the direction of IShares Fundamental i.e., IShares Fundamental and Ivanhoe Mines go up and down completely randomly.
Pair Corralation between IShares Fundamental and Ivanhoe Mines
Assuming the 90 days trading horizon IShares Fundamental is expected to generate 2.36 times less return on investment than Ivanhoe Mines. But when comparing it to its historical volatility, iShares Fundamental Hedged is 4.29 times less risky than Ivanhoe Mines. It trades about 0.12 of its potential returns per unit of risk. Ivanhoe Mines is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,414 in Ivanhoe Mines on September 1, 2024 and sell it today you would earn a total of 471.00 from holding Ivanhoe Mines or generate 33.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Fundamental Hedged vs. Ivanhoe Mines
Performance |
| Timeline |
| iShares Fundamental |
| Ivanhoe Mines |
IShares Fundamental and Ivanhoe Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Fundamental and Ivanhoe Mines
The main advantage of trading using opposite IShares Fundamental and Ivanhoe Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Fundamental position performs unexpectedly, Ivanhoe Mines 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 Ivanhoe Mines will offset losses from the drop in Ivanhoe Mines' long position.| IShares Fundamental vs. Brompton Global Dividend | IShares Fundamental vs. Global Healthcare Income | IShares Fundamental vs. Tech Leaders Income | IShares Fundamental vs. Brompton North American |
| Ivanhoe Mines vs. Kiplin Metals | Ivanhoe Mines vs. Pure Energy Minerals | Ivanhoe Mines vs. Noram Lithium Corp | Ivanhoe Mines vs. Minnova Corp |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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