Correlation Between Ivanhoe Energy and Stella Jones
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Stella Jones 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 Stella Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Stella Jones, you can compare the effects of market volatilities on Ivanhoe Energy and Stella Jones 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 Stella Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Stella Jones.
Diversification Opportunities for Ivanhoe Energy and Stella Jones
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ivanhoe and Stella is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Stella Jones in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stella Jones 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 Stella Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stella Jones has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Stella Jones go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Stella Jones
Assuming the 90 days horizon Ivanhoe Energy is expected to generate 0.76 times more return on investment than Stella Jones. However, Ivanhoe Energy is 1.31 times less risky than Stella Jones. It trades about -0.27 of its potential returns per unit of risk. Stella Jones is currently generating about -0.25 per unit of risk. If you would invest 1,552 in Ivanhoe Energy on August 28, 2024 and sell it today you would lose (219.00) from holding Ivanhoe Energy or give up 14.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Energy vs. Stella Jones
Performance |
| Timeline |
| Ivanhoe Energy |
| Stella Jones |
Ivanhoe Energy and Stella Jones Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Stella Jones
The main advantage of trading using opposite Ivanhoe Energy and Stella Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Stella Jones 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 Stella Jones will offset losses from the drop in Stella Jones' long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited | Ivanhoe Energy vs. iShares Canadian HYBrid |
| Stella Jones vs. Richelieu Hardware | Stella Jones vs. CCL Industries | Stella Jones vs. Stantec | Stella Jones vs. Gildan Activewear |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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