Correlation Between Ivanhoe Energy and Bell Copper
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Bell Copper 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 Bell Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Bell Copper Corp, you can compare the effects of market volatilities on Ivanhoe Energy and Bell Copper 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 Bell Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Bell Copper.
Diversification Opportunities for Ivanhoe Energy and Bell Copper
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ivanhoe and Bell is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Bell Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bell Copper Corp 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 Bell Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bell Copper Corp has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Bell Copper go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Bell Copper
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Bell Copper. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 2.95 times less risky than Bell Copper. The stock trades about -0.29 of its potential returns per unit of risk. The Bell Copper Corp is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 5.00 in Bell Copper Corp on September 15, 2024 and sell it today you would lose (1.50) from holding Bell Copper Corp or give up 30.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ivanhoe Energy vs. Bell Copper Corp
Performance |
| Timeline |
| Ivanhoe Energy |
| Bell Copper Corp |
Ivanhoe Energy and Bell Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Bell Copper
The main advantage of trading using opposite Ivanhoe Energy and Bell Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Bell Copper 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 Bell Copper will offset losses from the drop in Bell Copper's long position.The idea behind Ivanhoe Energy and Bell Copper Corp 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.| Bell Copper vs. Pacific Ridge Exploration | Bell Copper vs. BCM Resources Corp | Bell Copper vs. Dore Copper Mining | Bell Copper vs. Goliath Resources |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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