Correlation Between Ivanhoe Energy and Highland Copper
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Highland 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 Highland 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 Highland Copper, you can compare the effects of market volatilities on Ivanhoe Energy and Highland 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 Highland Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Highland Copper.
Diversification Opportunities for Ivanhoe Energy and Highland Copper
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ivanhoe and Highland is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Highland Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highland Copper 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 Highland Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highland Copper has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Highland Copper go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Highland Copper
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Highland Copper. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 1.1 times less risky than Highland Copper. The stock trades about -0.08 of its potential returns per unit of risk. The Highland Copper is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9.50 in Highland Copper on September 1, 2024 and sell it today you would earn a total of 0.50 from holding Highland Copper or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Energy vs. Highland Copper
Performance |
| Timeline |
| Ivanhoe Energy |
| Highland Copper |
Ivanhoe Energy and Highland Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Highland Copper
The main advantage of trading using opposite Ivanhoe Energy and Highland Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Highland 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 Highland Copper will offset losses from the drop in Highland Copper's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Highland Copper vs. First Majestic Silver | Highland Copper vs. Ivanhoe Energy | Highland Copper vs. Orezone Gold Corp | Highland Copper 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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