Correlation Between Ivanhoe Mines and Advantage Solutions
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Mines and Advantage Solutions 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 Advantage Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Mines and Advantage Solutions, you can compare the effects of market volatilities on Ivanhoe Mines and Advantage Solutions 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 Advantage Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Mines and Advantage Solutions.
Diversification Opportunities for Ivanhoe Mines and Advantage Solutions
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ivanhoe and Advantage is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Mines and Advantage Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantage Solutions 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 Advantage Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantage Solutions has no effect on the direction of Ivanhoe Mines i.e., Ivanhoe Mines and Advantage Solutions go up and down completely randomly.
Pair Corralation between Ivanhoe Mines and Advantage Solutions
Assuming the 90 days horizon Ivanhoe Mines is expected to generate 6.36 times less return on investment than Advantage Solutions. But when comparing it to its historical volatility, Ivanhoe Mines is 6.56 times less risky than Advantage Solutions. It trades about 0.06 of its potential returns per unit of risk. Advantage Solutions is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Advantage Solutions on September 12, 2024 and sell it today you would lose (10.20) from holding Advantage Solutions or give up 85.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 75.3% |
| Values | Daily Returns |
Ivanhoe Mines vs. Advantage Solutions
Performance |
| Timeline |
| Ivanhoe Mines |
| Advantage Solutions |
Ivanhoe Mines and Advantage Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Mines and Advantage Solutions
The main advantage of trading using opposite Ivanhoe Mines and Advantage Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Mines position performs unexpectedly, Advantage Solutions 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 Advantage Solutions will offset losses from the drop in Advantage Solutions' long position.| Ivanhoe Mines vs. Advantage Solutions | Ivanhoe Mines vs. Atlas Corp | Ivanhoe Mines vs. PureCycle Technologies | Ivanhoe Mines vs. WM Technology |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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