Correlation Between IGO and Qubec Nickel
Can any of the company-specific risk be diversified away by investing in both IGO and Qubec 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 IGO and Qubec Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IGO Limited and Qubec Nickel Corp, you can compare the effects of market volatilities on IGO and Qubec 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 IGO with a short position of Qubec Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of IGO and Qubec Nickel.
Diversification Opportunities for IGO and Qubec Nickel
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between IGO and Qubec is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding IGO 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 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 Qubec 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 IGO i.e., IGO and Qubec Nickel go up and down completely randomly.
Pair Corralation between IGO and Qubec Nickel
Assuming the 90 days horizon IGO is expected to generate 1085.78 times less return on investment than Qubec Nickel. But when comparing it to its historical volatility, IGO Limited is 43.18 times less risky than Qubec Nickel. It trades about 0.0 of its potential returns per unit of risk. Qubec Nickel Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 7.15 in Qubec Nickel Corp on November 5, 2024 and sell it today you would lose (0.71) from holding Qubec Nickel Corp or give up 9.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
IGO Limited vs. Qubec Nickel Corp
Performance |
| Timeline |
| IGO Limited |
| Qubec Nickel Corp |
IGO and Qubec Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IGO and Qubec Nickel
The main advantage of trading using opposite IGO and Qubec Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IGO position performs unexpectedly, Qubec 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 Qubec Nickel will offset losses from the drop in Qubec Nickel's long position.| IGO vs. Grid Metals Corp | IGO vs. First American Silver | IGO vs. Qubec Nickel Corp | IGO vs. Lithium Australia NL |
| Qubec Nickel vs. Norra Metals Corp | Qubec Nickel vs. E79 Resources Corp | Qubec Nickel vs. Voltage Metals Corp | Qubec Nickel vs. Cantex Mine Development |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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