Correlation Between Geodrill and Ivanhoe Mines
Can any of the company-specific risk be diversified away by investing in both Geodrill 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 Geodrill and Ivanhoe Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geodrill Limited and Ivanhoe Mines, you can compare the effects of market volatilities on Geodrill 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 Geodrill with a short position of Ivanhoe Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geodrill and Ivanhoe Mines.
Diversification Opportunities for Geodrill and Ivanhoe Mines
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Geodrill and Ivanhoe is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Geodrill Limited and Ivanhoe Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivanhoe Mines and Geodrill 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 Geodrill Limited 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 Geodrill i.e., Geodrill and Ivanhoe Mines go up and down completely randomly.
Pair Corralation between Geodrill and Ivanhoe Mines
Assuming the 90 days trading horizon Geodrill Limited is expected to generate 1.15 times more return on investment than Ivanhoe Mines. However, Geodrill is 1.15 times more volatile than Ivanhoe Mines. It trades about 0.17 of its potential returns per unit of risk. Ivanhoe Mines is currently generating about -0.08 per unit of risk. If you would invest 275.00 in Geodrill Limited on September 19, 2024 and sell it today you would earn a total of 24.00 from holding Geodrill Limited or generate 8.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geodrill Limited vs. Ivanhoe Mines
Performance |
| Timeline |
| Geodrill Limited |
| Ivanhoe Mines |
Geodrill and Ivanhoe Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geodrill and Ivanhoe Mines
The main advantage of trading using opposite Geodrill and Ivanhoe Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geodrill 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.| Geodrill vs. Stria Lithium | Geodrill vs. Dynacor Gold Mines | Geodrill vs. Foraco International SA | Geodrill vs. Hammond Power Solutions |
| Ivanhoe Mines vs. Foraco International SA | Ivanhoe Mines vs. Geodrill Limited | Ivanhoe Mines vs. Major Drilling Group | Ivanhoe Mines vs. Bri Chem 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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