Correlation Between Mullen Automotive and IGG
Can any of the company-specific risk be diversified away by investing in both Mullen Automotive and IGG 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 Mullen Automotive and IGG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mullen Automotive and IGG Inc, you can compare the effects of market volatilities on Mullen Automotive and IGG 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 Mullen Automotive with a short position of IGG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mullen Automotive and IGG.
Diversification Opportunities for Mullen Automotive and IGG
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mullen and IGG is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Mullen Automotive and IGG Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGG Inc and Mullen Automotive 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 Mullen Automotive are associated (or correlated) with IGG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGG Inc has no effect on the direction of Mullen Automotive i.e., Mullen Automotive and IGG go up and down completely randomly.
Pair Corralation between Mullen Automotive and IGG
Given the investment horizon of 90 days Mullen Automotive is expected to under-perform the IGG. But the stock apears to be less risky and, when comparing its historical volatility, Mullen Automotive is 1.0 times less risky than IGG. The stock trades about -0.13 of its potential returns per unit of risk. The IGG Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 34.00 in IGG Inc on August 23, 2024 and sell it today you would earn a total of 19.00 from holding IGG Inc or generate 55.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Mullen Automotive vs. IGG Inc
Performance |
| Timeline |
| Mullen Automotive |
| IGG Inc |
Mullen Automotive and IGG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mullen Automotive and IGG
The main advantage of trading using opposite Mullen Automotive and IGG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mullen Automotive position performs unexpectedly, IGG 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 IGG will offset losses from the drop in IGG's long position.| Mullen Automotive vs. Hycroft Mining Holding | Mullen Automotive vs. Imperial Petroleum | Mullen Automotive vs. Camber Energy |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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