Correlation Between IGO and Graphano Energy
Can any of the company-specific risk be diversified away by investing in both IGO and Graphano Energy 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 Graphano Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IGO Limited and Graphano Energy, you can compare the effects of market volatilities on IGO and Graphano Energy 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 Graphano Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of IGO and Graphano Energy.
Diversification Opportunities for IGO and Graphano Energy
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IGO and Graphano is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding IGO Limited and Graphano Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graphano Energy 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 Graphano Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graphano Energy has no effect on the direction of IGO i.e., IGO and Graphano Energy go up and down completely randomly.
Pair Corralation between IGO and Graphano Energy
Assuming the 90 days horizon IGO Limited is expected to under-perform the Graphano Energy. But the pink sheet apears to be less risky and, when comparing its historical volatility, IGO Limited is 4.16 times less risky than Graphano Energy. The pink sheet trades about -0.07 of its potential returns per unit of risk. The Graphano Energy is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Graphano Energy on September 12, 2024 and sell it today you would lose (5.92) from holding Graphano Energy or give up 53.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
IGO Limited vs. Graphano Energy
Performance |
| Timeline |
| IGO Limited |
| Graphano Energy |
IGO and Graphano Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IGO and Graphano Energy
The main advantage of trading using opposite IGO and Graphano Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IGO position performs unexpectedly, Graphano Energy 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 Graphano Energy will offset losses from the drop in Graphano Energy's long position.| IGO vs. Qubec Nickel Corp | IGO vs. Nickel Mines Limited | IGO vs. Mineral Resources Limited | IGO vs. Surge Copper Corp |
| Graphano Energy vs. Qubec Nickel Corp | Graphano Energy vs. IGO Limited | Graphano Energy vs. Focus Graphite | Graphano Energy vs. Mineral Res |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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