Correlation Between Ivanhoe Electric and First Trust
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Electric and First Trust 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 First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Electric and First Trust Exchange Traded, you can compare the effects of market volatilities on Ivanhoe Electric and First Trust 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 First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Electric and First Trust.
Diversification Opportunities for Ivanhoe Electric and First Trust
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ivanhoe and First is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Electric and First Trust Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Exchange 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 First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Exchange has no effect on the direction of Ivanhoe Electric i.e., Ivanhoe Electric and First Trust go up and down completely randomly.
Pair Corralation between Ivanhoe Electric and First Trust
Allowing for the 90-day total investment horizon Ivanhoe Electric is expected to under-perform the First Trust. In addition to that, Ivanhoe Electric is 26.12 times more volatile than First Trust Exchange Traded. It trades about -0.02 of its total potential returns per unit of risk. First Trust Exchange Traded is currently generating about 0.22 per unit of volatility. If you would invest 1,920 in First Trust Exchange Traded on September 12, 2024 and sell it today you would earn a total of 130.00 from holding First Trust Exchange Traded or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 56.53% |
| Values | Daily Returns |
Ivanhoe Electric vs. First Trust Exchange Traded
Performance |
| Timeline |
| Ivanhoe Electric |
| First Trust Exchange |
Ivanhoe Electric and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Electric and First Trust
The main advantage of trading using opposite Ivanhoe Electric and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Electric position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| Ivanhoe Electric vs. Osaka Steel Co, | Ivanhoe Electric vs. SunLink Health Systems | Ivanhoe Electric vs. Olympic Steel | Ivanhoe Electric vs. Merit Medical Systems |
| First Trust vs. Valued Advisers Trust | First Trust vs. Columbia Diversified Fixed | First Trust vs. Principal Exchange Traded Funds | First Trust vs. Doubleline Etf Trust |
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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