Correlation Between Pan Global and IGO
Can any of the company-specific risk be diversified away by investing in both Pan Global 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 Pan Global and IGO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Global Resources and IGO Limited, you can compare the effects of market volatilities on Pan Global 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 Pan Global with a short position of IGO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Global and IGO.
Diversification Opportunities for Pan Global and IGO
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pan and IGO is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Pan Global Resources and IGO Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGO Limited and Pan Global 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 Pan Global Resources 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 Pan Global i.e., Pan Global and IGO go up and down completely randomly.
Pair Corralation between Pan Global and IGO
Assuming the 90 days horizon Pan Global Resources is expected to generate 3.99 times more return on investment than IGO. However, Pan Global is 3.99 times more volatile than IGO Limited. It trades about 0.27 of its potential returns per unit of risk. IGO Limited is currently generating about 0.22 per unit of risk. If you would invest 7.07 in Pan Global Resources on October 24, 2024 and sell it today you would earn a total of 2.81 from holding Pan Global Resources or generate 39.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Pan Global Resources vs. IGO Limited
Performance |
| Timeline |
| Pan Global Resources |
| IGO Limited |
Pan Global and IGO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Global and IGO
The main advantage of trading using opposite Pan Global and IGO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Global 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.| Pan Global vs. Li Auto | Pan Global vs. Tianjin Capital Environmental | Pan Global vs. Lucid Group | Pan Global vs. HUHUTECH International Group |
| 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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