Correlation Between Ivanhoe Electric and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Electric and Dow 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 Electric and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Electric and Dow Jones Industrial, you can compare the effects of market volatilities on Ivanhoe Electric and Dow 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 Electric with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Electric and Dow Jones.
Diversification Opportunities for Ivanhoe Electric and Dow Jones
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ivanhoe and Dow is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Electric and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Ivanhoe Electric 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 Electric are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Ivanhoe Electric i.e., Ivanhoe Electric and Dow Jones go up and down completely randomly.
Pair Corralation between Ivanhoe Electric and Dow Jones
Allowing for the 90-day total investment horizon Ivanhoe Electric is expected to under-perform the Dow Jones. In addition to that, Ivanhoe Electric is 3.04 times more volatile than Dow Jones Industrial. It trades about -0.24 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.26 per unit of volatility. If you would invest 4,238,757 in Dow Jones Industrial on August 28, 2024 and sell it today you would earn a total of 234,900 from holding Dow Jones Industrial or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Electric vs. Dow Jones Industrial
Performance |
| Timeline |
Ivanhoe Electric and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Ivanhoe Electric
Pair trading matchups for Ivanhoe Electric
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Ivanhoe Electric and Dow Jones
The main advantage of trading using opposite Ivanhoe Electric and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Electric position performs unexpectedly, Dow 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Ivanhoe Electric vs. Luxfer Holdings PLC | Ivanhoe Electric vs. Centessa Pharmaceuticals PLC | Ivanhoe Electric vs. Braskem SA Class | Ivanhoe Electric vs. Mativ Holdings |
| Dow Jones vs. Meiwu Technology Co | Dow Jones vs. 17 Education Technology | Dow Jones vs. 51Talk Online Education | Dow Jones vs. Afya |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |