Correlation Between Ivanhoe Energy and Granada Gold
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Granada Gold 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 Granada Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Granada Gold Mine, you can compare the effects of market volatilities on Ivanhoe Energy and Granada Gold 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 Granada Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Granada Gold.
Diversification Opportunities for Ivanhoe Energy and Granada Gold
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ivanhoe and Granada is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Granada Gold Mine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granada Gold Mine 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 Granada Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granada Gold Mine has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Granada Gold go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Granada Gold
Assuming the 90 days horizon Ivanhoe Energy is expected to generate 0.33 times more return on investment than Granada Gold. However, Ivanhoe Energy is 2.99 times less risky than Granada Gold. It trades about -0.08 of its potential returns per unit of risk. Granada Gold Mine is currently generating about -0.17 per unit of risk. If you would invest 1,415 in Ivanhoe Energy on September 1, 2024 and sell it today you would lose (85.00) from holding Ivanhoe Energy or give up 6.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ivanhoe Energy vs. Granada Gold Mine
Performance |
| Timeline |
| Ivanhoe Energy |
| Granada Gold Mine |
Ivanhoe Energy and Granada Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Granada Gold
The main advantage of trading using opposite Ivanhoe Energy and Granada Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Granada Gold 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 Granada Gold will offset losses from the drop in Granada Gold's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Granada Gold vs. First Majestic Silver | Granada Gold vs. Ivanhoe Energy | Granada Gold vs. Orezone Gold Corp | Granada Gold 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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