Correlation Between Rubicon Water and IXUP
Can any of the company-specific risk be diversified away by investing in both Rubicon Water and IXUP 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 Rubicon Water and IXUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rubicon Water and IXUP, you can compare the effects of market volatilities on Rubicon Water and IXUP 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 Rubicon Water with a short position of IXUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rubicon Water and IXUP.
Diversification Opportunities for Rubicon Water and IXUP
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rubicon and IXUP is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Rubicon Water and IXUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IXUP and Rubicon Water 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 Rubicon Water are associated (or correlated) with IXUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IXUP has no effect on the direction of Rubicon Water i.e., Rubicon Water and IXUP go up and down completely randomly.
Pair Corralation between Rubicon Water and IXUP
Assuming the 90 days trading horizon Rubicon Water is expected to under-perform the IXUP. But the stock apears to be less risky and, when comparing its historical volatility, Rubicon Water is 3.32 times less risky than IXUP. The stock trades about -0.44 of its potential returns per unit of risk. The IXUP is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 0.90 in IXUP on November 27, 2024 and sell it today you would earn a total of 0.10 from holding IXUP or generate 11.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rubicon Water vs. IXUP
Performance |
| Timeline |
| Rubicon Water |
| IXUP |
Rubicon Water and IXUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rubicon Water and IXUP
The main advantage of trading using opposite Rubicon Water and IXUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rubicon Water position performs unexpectedly, IXUP 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 IXUP will offset losses from the drop in IXUP's long position.| Rubicon Water vs. K2 Asset Management | Rubicon Water vs. Sonic Healthcare | Rubicon Water vs. Vitura Health Limited | Rubicon Water vs. Epsilon Healthcare |
| IXUP vs. BKI Investment | IXUP vs. Navigator Global Investments | IXUP vs. Dalaroo Metals | IXUP vs. Polymetals Resources |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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