Correlation Between Ivanhoe Energy and Kootenay Silver
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Kootenay Silver 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 Kootenay Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Kootenay Silver, you can compare the effects of market volatilities on Ivanhoe Energy and Kootenay Silver 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 Kootenay Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Kootenay Silver.
Diversification Opportunities for Ivanhoe Energy and Kootenay Silver
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ivanhoe and Kootenay is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Kootenay Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kootenay Silver 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 Kootenay Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kootenay Silver has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Kootenay Silver go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Kootenay Silver
Assuming the 90 days horizon Ivanhoe Energy is expected to generate 2.23 times less return on investment than Kootenay Silver. But when comparing it to its historical volatility, Ivanhoe Energy is 1.12 times less risky than Kootenay Silver. It trades about 0.02 of its potential returns per unit of risk. Kootenay Silver is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 83.00 in Kootenay Silver on August 29, 2024 and sell it today you would earn a total of 24.00 from holding Kootenay Silver or generate 28.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
Ivanhoe Energy vs. Kootenay Silver
Performance |
| Timeline |
| Ivanhoe Energy |
| Kootenay Silver |
Ivanhoe Energy and Kootenay Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Kootenay Silver
The main advantage of trading using opposite Ivanhoe Energy and Kootenay Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Kootenay Silver 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 Kootenay Silver will offset losses from the drop in Kootenay Silver's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Kootenay Silver vs. IMPACT Silver Corp | Kootenay Silver vs. Outcrop Gold Corp | Kootenay Silver vs. Dolly Varden Silver | Kootenay Silver vs. Klondike Silver 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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