Correlation Between Ivanhoe Energy and Pacific Bay
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Pacific Bay 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 Pacific Bay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Pacific Bay Minerals, you can compare the effects of market volatilities on Ivanhoe Energy and Pacific Bay 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 Pacific Bay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Pacific Bay.
Diversification Opportunities for Ivanhoe Energy and Pacific Bay
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ivanhoe and Pacific is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Pacific Bay Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacific Bay 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 Pacific Bay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacific Bay Minerals has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Pacific Bay go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Pacific Bay
Assuming the 90 days horizon Ivanhoe Energy is expected to under-perform the Pacific Bay. But the stock apears to be less risky and, when comparing its historical volatility, Ivanhoe Energy is 4.83 times less risky than Pacific Bay. The stock trades about -0.02 of its potential returns per unit of risk. The Pacific Bay Minerals is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3.50 in Pacific Bay Minerals on November 27, 2024 and sell it today you would earn a total of 1.50 from holding Pacific Bay Minerals or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 54.25% |
| Values | Daily Returns |
Ivanhoe Energy vs. Pacific Bay Minerals
Performance |
| Timeline |
| Ivanhoe Energy |
| Pacific Bay Minerals |
Ivanhoe Energy and Pacific Bay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Pacific Bay
The main advantage of trading using opposite Ivanhoe Energy and Pacific Bay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Pacific Bay 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 Pacific Bay will offset losses from the drop in Pacific Bay's long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Pacific Bay vs. CNJ Capital Investments | Pacific Bay vs. Atrium Mortgage Investment | Pacific Bay vs. Goodfood Market Corp | Pacific Bay vs. Solid Impact Investments |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |