Correlation Between Iluka Resources and Québec Nickel
Can any of the company-specific risk be diversified away by investing in both Iluka Resources and Québec Nickel 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 Iluka Resources and Québec Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iluka Resources Limited and Qubec Nickel Corp, you can compare the effects of market volatilities on Iluka Resources and Québec Nickel 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 Iluka Resources with a short position of Québec Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iluka Resources and Québec Nickel.
Diversification Opportunities for Iluka Resources and Québec Nickel
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Iluka and Québec is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Iluka Resources Limited and Qubec Nickel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qubec Nickel Corp and Iluka Resources 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 Iluka Resources Limited are associated (or correlated) with Québec Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qubec Nickel Corp has no effect on the direction of Iluka Resources i.e., Iluka Resources and Québec Nickel go up and down completely randomly.
Pair Corralation between Iluka Resources and Québec Nickel
If you would invest 363.00 in Iluka Resources Limited on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Iluka Resources Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Iluka Resources Limited vs. Qubec Nickel Corp
Performance |
| Timeline |
| Iluka Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Qubec Nickel Corp |
Iluka Resources and Québec Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iluka Resources and Québec Nickel
The main advantage of trading using opposite Iluka Resources and Québec Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iluka Resources position performs unexpectedly, Québec Nickel 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 Québec Nickel will offset losses from the drop in Québec Nickel's long position.| Iluka Resources vs. Iluka Resources Ltd | Iluka Resources vs. China Rare Earth | Iluka Resources vs. Greenland Minerals And | Iluka Resources vs. Mkango Resources |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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