Correlation Between Ivanhoe Energy and Finlay Minerals
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Finlay Minerals 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 Finlay Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Finlay Minerals, you can compare the effects of market volatilities on Ivanhoe Energy and Finlay Minerals 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 Finlay Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Finlay Minerals.
Diversification Opportunities for Ivanhoe Energy and Finlay Minerals
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ivanhoe and Finlay is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Finlay Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finlay Minerals 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 Finlay Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finlay Minerals has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Finlay Minerals go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Finlay Minerals
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Finlay Minerals. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 4.04 times less risky than Finlay Minerals. The stock trades about -0.02 of its potential returns per unit of risk. The Finlay Minerals is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 5.00 in Finlay Minerals on November 2, 2024 and sell it today you would earn a total of 2.50 from holding Finlay Minerals or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Energy vs. Finlay Minerals
Performance |
| Timeline |
| Ivanhoe Energy |
| Finlay Minerals |
Ivanhoe Energy and Finlay Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Finlay Minerals
The main advantage of trading using opposite Ivanhoe Energy and Finlay Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Finlay Minerals 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 Finlay Minerals will offset losses from the drop in Finlay Minerals' long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Finlay Minerals vs. CMC Metals | Finlay Minerals vs. Tarku Resources | Finlay Minerals vs. Highway 50 Gold |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |