Correlation Between Icad and EnviroGold Global
Can any of the company-specific risk be diversified away by investing in both Icad and EnviroGold Global 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 Icad and EnviroGold Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between icad inc and EnviroGold Global Limited, you can compare the effects of market volatilities on Icad and EnviroGold Global 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 Icad with a short position of EnviroGold Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icad and EnviroGold Global.
Diversification Opportunities for Icad and EnviroGold Global
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Icad and EnviroGold is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding icad inc and EnviroGold Global Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EnviroGold Global and Icad 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 icad inc are associated (or correlated) with EnviroGold Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EnviroGold Global has no effect on the direction of Icad i.e., Icad and EnviroGold Global go up and down completely randomly.
Pair Corralation between Icad and EnviroGold Global
Given the investment horizon of 90 days Icad is expected to generate 1.11 times less return on investment than EnviroGold Global. But when comparing it to its historical volatility, icad inc is 1.34 times less risky than EnviroGold Global. It trades about 0.07 of its potential returns per unit of risk. EnviroGold Global Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3.27 in EnviroGold Global Limited on September 13, 2024 and sell it today you would earn a total of 0.93 from holding EnviroGold Global Limited or generate 28.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
icad inc vs. EnviroGold Global Limited
Performance |
| Timeline |
| icad inc |
| EnviroGold Global |
Icad and EnviroGold Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icad and EnviroGold Global
The main advantage of trading using opposite Icad and EnviroGold Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icad position performs unexpectedly, EnviroGold Global 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 EnviroGold Global will offset losses from the drop in EnviroGold Global's long position.The idea behind icad inc and EnviroGold Global Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| EnviroGold Global vs. Star Royalties | EnviroGold Global vs. Riverside Resources | EnviroGold Global vs. Mirasol Resources | EnviroGold Global vs. Defiance Silver 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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