Correlation Between Ivanhoe Energy and Graphite One
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Graphite One 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 Graphite One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Graphite One, you can compare the effects of market volatilities on Ivanhoe Energy and Graphite One 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 Graphite One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Graphite One.
Diversification Opportunities for Ivanhoe Energy and Graphite One
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ivanhoe and Graphite is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Graphite One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graphite One 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 Graphite One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graphite One has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Graphite One go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Graphite One
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Graphite One. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 1.1 times less risky than Graphite One. The stock trades about -0.3 of its potential returns per unit of risk. The Graphite One is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 68.00 in Graphite One on November 1, 2024 and sell it today you would earn a total of 27.00 from holding Graphite One or generate 39.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ivanhoe Energy vs. Graphite One
Performance |
| Timeline |
| Ivanhoe Energy |
| Graphite One |
Ivanhoe Energy and Graphite One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Graphite One
The main advantage of trading using opposite Ivanhoe Energy and Graphite One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Graphite One 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 Graphite One will offset losses from the drop in Graphite One's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Graphite One vs. Northern Graphite | Graphite One vs. Mason Graphite | Graphite One vs. Focus Graphite | Graphite One vs. Canada Carbon |
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.
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