Correlation Between Mundoro Capital and IGO
Can any of the company-specific risk be diversified away by investing in both Mundoro Capital and IGO 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 Mundoro Capital and IGO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mundoro Capital and IGO Limited, you can compare the effects of market volatilities on Mundoro Capital and IGO 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 Mundoro Capital with a short position of IGO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mundoro Capital and IGO.
Diversification Opportunities for Mundoro Capital and IGO
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mundoro and IGO is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Mundoro Capital and IGO Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGO Limited and Mundoro Capital 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 Mundoro Capital are associated (or correlated) with IGO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGO Limited has no effect on the direction of Mundoro Capital i.e., Mundoro Capital and IGO go up and down completely randomly.
Pair Corralation between Mundoro Capital and IGO
Assuming the 90 days horizon Mundoro Capital is expected to under-perform the IGO. In addition to that, Mundoro Capital is 2.01 times more volatile than IGO Limited. It trades about -0.1 of its total potential returns per unit of risk. IGO Limited is currently generating about -0.07 per unit of volatility. If you would invest 348.00 in IGO Limited on August 30, 2024 and sell it today you would lose (8.00) from holding IGO Limited or give up 2.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mundoro Capital vs. IGO Limited
Performance |
| Timeline |
| Mundoro Capital |
| IGO Limited |
Mundoro Capital and IGO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mundoro Capital and IGO
The main advantage of trading using opposite Mundoro Capital and IGO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mundoro Capital position performs unexpectedly, IGO 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 IGO will offset losses from the drop in IGO's long position.| Mundoro Capital vs. Silver Hammer Mining | Mundoro Capital vs. Reyna Silver Corp | Mundoro Capital vs. Guanajuato Silver | Mundoro Capital vs. Silver One Resources |
| IGO vs. Grid Metals Corp | IGO vs. First American Silver | IGO vs. Qubec Nickel Corp | IGO vs. Lithium Australia NL |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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