Correlation Between Intrepid Potash and CGA Old
Can any of the company-specific risk be diversified away by investing in both Intrepid Potash and CGA Old 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 Intrepid Potash and CGA Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intrepid Potash and CGA Old, you can compare the effects of market volatilities on Intrepid Potash and CGA Old 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 Intrepid Potash with a short position of CGA Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intrepid Potash and CGA Old.
Diversification Opportunities for Intrepid Potash and CGA Old
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Intrepid and CGA is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Intrepid Potash and CGA Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CGA Old and Intrepid Potash 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 Intrepid Potash are associated (or correlated) with CGA Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CGA Old has no effect on the direction of Intrepid Potash i.e., Intrepid Potash and CGA Old go up and down completely randomly.
Pair Corralation between Intrepid Potash and CGA Old
If you would invest 2,250 in Intrepid Potash on October 25, 2024 and sell it today you would earn a total of 498.00 from holding Intrepid Potash or generate 22.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Intrepid Potash vs. CGA Old
Performance |
| Timeline |
| Intrepid Potash |
| CGA Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Intrepid Potash and CGA Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intrepid Potash and CGA Old
The main advantage of trading using opposite Intrepid Potash and CGA Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intrepid Potash position performs unexpectedly, CGA Old 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 CGA Old will offset losses from the drop in CGA Old's long position.| Intrepid Potash vs. The Mosaic | Intrepid Potash vs. Nutrien | Intrepid Potash vs. Corteva | Intrepid Potash vs. FMC Corporation |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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