Correlation Between South Star and IGO
Can any of the company-specific risk be diversified away by investing in both South Star 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 South Star and IGO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between South Star Battery and IGO Limited, you can compare the effects of market volatilities on South Star 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 South Star with a short position of IGO. Check out your portfolio center. Please also check ongoing floating volatility patterns of South Star and IGO.
Diversification Opportunities for South Star and IGO
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between South and IGO is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding South Star Battery and IGO Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGO Limited and South Star 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 South Star Battery 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 South Star i.e., South Star and IGO go up and down completely randomly.
Pair Corralation between South Star and IGO
Assuming the 90 days horizon South Star Battery is expected to under-perform the IGO. In addition to that, South Star is 8.89 times more volatile than IGO Limited. It trades about -0.04 of its total potential returns per unit of risk. IGO Limited is currently generating about -0.22 per unit of volatility. If you would invest 601.00 in IGO Limited on November 2, 2024 and sell it today you would lose (28.00) from holding IGO Limited or give up 4.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
South Star Battery vs. IGO Limited
Performance |
| Timeline |
| South Star Battery |
| IGO Limited |
South Star and IGO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with South Star and IGO
The main advantage of trading using opposite South Star and IGO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South Star 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.| South Star vs. ZincX Resources Corp | South Star vs. Nuinsco Resources Limited | South Star vs. Qubec Nickel Corp | South Star vs. Rockridge Resources |
| IGO vs. Qubec Nickel Corp | IGO vs. Nickel Mines Limited | IGO vs. Mineral Resources Limited | IGO vs. Surge Copper Corp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |