Correlation Between Oceanic Iron and IGM Financial
Can any of the company-specific risk be diversified away by investing in both Oceanic Iron and IGM Financial 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 Oceanic Iron and IGM Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oceanic Iron Ore and IGM Financial, you can compare the effects of market volatilities on Oceanic Iron and IGM Financial 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 Oceanic Iron with a short position of IGM Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oceanic Iron and IGM Financial.
Diversification Opportunities for Oceanic Iron and IGM Financial
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Oceanic and IGM is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Oceanic Iron Ore and IGM Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGM Financial and Oceanic Iron 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 Oceanic Iron Ore are associated (or correlated) with IGM Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGM Financial has no effect on the direction of Oceanic Iron i.e., Oceanic Iron and IGM Financial go up and down completely randomly.
Pair Corralation between Oceanic Iron and IGM Financial
Assuming the 90 days horizon Oceanic Iron Ore is expected to under-perform the IGM Financial. In addition to that, Oceanic Iron is 8.82 times more volatile than IGM Financial. It trades about -0.11 of its total potential returns per unit of risk. IGM Financial is currently generating about -0.09 per unit of volatility. If you would invest 4,636 in IGM Financial on September 20, 2024 and sell it today you would lose (84.00) from holding IGM Financial or give up 1.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oceanic Iron Ore vs. IGM Financial
Performance |
| Timeline |
| Oceanic Iron Ore |
| IGM Financial |
Oceanic Iron and IGM Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oceanic Iron and IGM Financial
The main advantage of trading using opposite Oceanic Iron and IGM Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oceanic Iron position performs unexpectedly, IGM Financial 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 IGM Financial will offset losses from the drop in IGM Financial's long position.| Oceanic Iron vs. IGM Financial | Oceanic Iron vs. North American Financial | Oceanic Iron vs. Constellation Software | Oceanic Iron vs. Wall Financial |
| IGM Financial vs. Berkshire Hathaway CDR | IGM Financial vs. E L Financial Corp | IGM Financial vs. E L Financial 3 | IGM Financial vs. Molson Coors Canada |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |