Correlation Between IGO and Blue Moon
Can any of the company-specific risk be diversified away by investing in both IGO and Blue Moon 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 IGO and Blue Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IGO Limited and Blue Moon Metals, you can compare the effects of market volatilities on IGO and Blue Moon 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 IGO with a short position of Blue Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of IGO and Blue Moon.
Diversification Opportunities for IGO and Blue Moon
Very weak diversification
The 3 months correlation between IGO and Blue is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding IGO Limited and Blue Moon Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Moon Metals and IGO 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 IGO Limited are associated (or correlated) with Blue Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Moon Metals has no effect on the direction of IGO i.e., IGO and Blue Moon go up and down completely randomly.
Pair Corralation between IGO and Blue Moon
If you would invest 680.00 in IGO Limited on September 15, 2024 and sell it today you would earn a total of 0.00 from holding IGO Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
IGO Limited vs. Blue Moon Metals
Performance |
| Timeline |
| IGO Limited |
| Blue Moon Metals |
IGO and Blue Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IGO and Blue Moon
The main advantage of trading using opposite IGO and Blue Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IGO position performs unexpectedly, Blue Moon 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 Blue Moon will offset losses from the drop in Blue Moon's long position.| IGO vs. Qubec Nickel Corp | IGO vs. Nickel Mines Limited | IGO vs. Mineral Resources Limited | IGO vs. Surge Copper Corp |
| Blue Moon vs. Canada Carbon | Blue Moon vs. Premium Nickel Resources | Blue Moon vs. Clime Investment Management | Blue Moon vs. CopAur Minerals |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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