Correlation Between IGO and Pershing Resources
Can any of the company-specific risk be diversified away by investing in both IGO and Pershing Resources 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 Pershing Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IGO Limited and Pershing Resources, you can compare the effects of market volatilities on IGO and Pershing Resources 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 Pershing Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of IGO and Pershing Resources.
Diversification Opportunities for IGO and Pershing Resources
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IGO and Pershing is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding IGO Limited and Pershing Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pershing Resources 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 Pershing Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pershing Resources has no effect on the direction of IGO i.e., IGO and Pershing Resources go up and down completely randomly.
Pair Corralation between IGO and Pershing Resources
If you would invest 2.00 in Pershing Resources on September 13, 2024 and sell it today you would lose (0.41) from holding Pershing Resources or give up 20.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IGO Limited vs. Pershing Resources
Performance |
| Timeline |
| IGO Limited |
| Pershing Resources |
IGO and Pershing Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IGO and Pershing Resources
The main advantage of trading using opposite IGO and Pershing Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IGO position performs unexpectedly, Pershing Resources 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 Pershing Resources will offset losses from the drop in Pershing Resources' long position.The idea behind IGO Limited and Pershing Resources pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Pershing Resources vs. Bravada Gold | Pershing Resources vs. Silver Spruce Resources | Pershing Resources vs. Monitor Ventures | Pershing Resources vs. Euro Manganese |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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