Correlation Between Ivanhoe Energy and Fab Form
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Fab Form 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 Fab Form into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Fab Form Industries, you can compare the effects of market volatilities on Ivanhoe Energy and Fab Form 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 Fab Form. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Fab Form.
Diversification Opportunities for Ivanhoe Energy and Fab Form
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ivanhoe and Fab is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Fab Form Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fab Form Industries 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 Fab Form. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fab Form Industries has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Fab Form go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Fab Form
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Fab Form. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 1.62 times less risky than Fab Form. The stock trades about -0.25 of its potential returns per unit of risk. The Fab Form Industries is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 159.00 in Fab Form Industries on August 30, 2024 and sell it today you would lose (18.00) from holding Fab Form Industries or give up 11.32% 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. Fab Form Industries
Performance |
| Timeline |
| Ivanhoe Energy |
| Fab Form Industries |
Ivanhoe Energy and Fab Form Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Fab Form
The main advantage of trading using opposite Ivanhoe Energy and Fab Form positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Fab Form 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 Fab Form will offset losses from the drop in Fab Form's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Fab Form vs. Atlas Engineered Products | Fab Form vs. Inventronics | Fab Form vs. Imaflex | Fab Form vs. AirIQ Inc |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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