Correlation Between Ivanhoe Mines and Kiplin Metals
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Mines and Kiplin Metals 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 Ivanhoe Mines and Kiplin Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Mines and Kiplin Metals, you can compare the effects of market volatilities on Ivanhoe Mines and Kiplin Metals 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 Ivanhoe Mines with a short position of Kiplin Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Mines and Kiplin Metals.
Diversification Opportunities for Ivanhoe Mines and Kiplin Metals
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ivanhoe and Kiplin is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Mines and Kiplin Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiplin Metals and Ivanhoe Mines 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 Ivanhoe Mines are associated (or correlated) with Kiplin Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiplin Metals has no effect on the direction of Ivanhoe Mines i.e., Ivanhoe Mines and Kiplin Metals go up and down completely randomly.
Pair Corralation between Ivanhoe Mines and Kiplin Metals
Assuming the 90 days trading horizon Ivanhoe Mines is expected to generate 0.59 times more return on investment than Kiplin Metals. However, Ivanhoe Mines is 1.69 times less risky than Kiplin Metals. It trades about 0.03 of its potential returns per unit of risk. Kiplin Metals is currently generating about -0.13 per unit of risk. If you would invest 1,862 in Ivanhoe Mines on September 3, 2024 and sell it today you would earn a total of 23.00 from holding Ivanhoe Mines or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Mines vs. Kiplin Metals
Performance |
| Timeline |
| Ivanhoe Mines |
| Kiplin Metals |
Ivanhoe Mines and Kiplin Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Mines and Kiplin Metals
The main advantage of trading using opposite Ivanhoe Mines and Kiplin Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Mines position performs unexpectedly, Kiplin Metals 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 Kiplin Metals will offset losses from the drop in Kiplin Metals' long position.| Ivanhoe Mines vs. Lundin Mining | Ivanhoe Mines vs. First Quantum Minerals | Ivanhoe Mines vs. HudBay Minerals | Ivanhoe Mines vs. Eldorado Gold Corp |
| Kiplin Metals vs. Algoma Steel Group | Kiplin Metals vs. Champion Iron | Kiplin Metals vs. International Zeolite Corp | Kiplin Metals vs. European Residential Real |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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