Correlation Between IGO and Green Battery
Can any of the company-specific risk be diversified away by investing in both IGO and Green Battery 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 Green Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IGO Limited and Green Battery Minerals, you can compare the effects of market volatilities on IGO and Green Battery 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 Green Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of IGO and Green Battery.
Diversification Opportunities for IGO and Green Battery
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IGO and Green is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding IGO Limited and Green Battery Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Battery Minerals 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 Green Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Battery Minerals has no effect on the direction of IGO i.e., IGO and Green Battery go up and down completely randomly.
Pair Corralation between IGO and Green Battery
Assuming the 90 days horizon IGO Limited is expected to under-perform the Green Battery. But the pink sheet apears to be less risky and, when comparing its historical volatility, IGO Limited is 2.88 times less risky than Green Battery. The pink sheet trades about -0.04 of its potential returns per unit of risk. The Green Battery Minerals is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 35.00 in Green Battery Minerals on September 4, 2024 and sell it today you would lose (30.08) from holding Green Battery Minerals or give up 85.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
IGO Limited vs. Green Battery Minerals
Performance |
| Timeline |
| IGO Limited |
| Green Battery Minerals |
IGO and Green Battery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IGO and Green Battery
The main advantage of trading using opposite IGO and Green Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IGO position performs unexpectedly, Green Battery 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 Green Battery will offset losses from the drop in Green Battery's long position.| IGO vs. Qubec Nickel Corp | IGO vs. Nickel Mines Limited | IGO vs. Mineral Resources Limited | IGO vs. Surge Copper Corp |
| Green Battery vs. Class 1 Nickel | Green Battery vs. Pampa Metals | Green Battery vs. EcoGraf Limited | Green Battery vs. M3 Metals Corp |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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