Correlation Between Ivanhoe Energy and Asiabasemetals
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Asiabasemetals 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 Ivanhoe Energy and Asiabasemetals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Asiabasemetals, you can compare the effects of market volatilities on Ivanhoe Energy and Asiabasemetals 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 Ivanhoe Energy with a short position of Asiabasemetals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Asiabasemetals.
Diversification Opportunities for Ivanhoe Energy and Asiabasemetals
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ivanhoe and Asiabasemetals is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Asiabasemetals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiabasemetals and Ivanhoe Energy 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 Ivanhoe Energy are associated (or correlated) with Asiabasemetals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiabasemetals has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Asiabasemetals go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Asiabasemetals
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Asiabasemetals. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 2.35 times less risky than Asiabasemetals. The stock trades about -0.25 of its potential returns per unit of risk. The Asiabasemetals is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 8.50 in Asiabasemetals on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Asiabasemetals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ivanhoe Energy vs. Asiabasemetals
Performance |
| Timeline |
| Ivanhoe Energy |
| Asiabasemetals |
Ivanhoe Energy and Asiabasemetals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Asiabasemetals
The main advantage of trading using opposite Ivanhoe Energy and Asiabasemetals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Asiabasemetals 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 Asiabasemetals will offset losses from the drop in Asiabasemetals' long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Asiabasemetals vs. First Majestic Silver | Asiabasemetals vs. Ivanhoe Energy | Asiabasemetals vs. Orezone Gold Corp | Asiabasemetals vs. Faraday Copper 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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