Correlation Between Igoria Trade and NGG

Can any of the company-specific risk be diversified away by investing in both Igoria Trade and NGG 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 Igoria Trade and NGG into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Igoria Trade SA and NGG, you can compare the effects of market volatilities on Igoria Trade and NGG 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 Igoria Trade with a short position of NGG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Igoria Trade and NGG.

Diversification Opportunities for Igoria Trade and NGG

0.45

Correlation Coefficient

Igoria Trade  NGG

Very weak diversification

The 3 months correlation between Igoria and NGG is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Igoria Trade SA and NGG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NGG and Igoria Trade 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 Igoria Trade SA are associated (or correlated) with NGG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NGG has no effect on the direction of Igoria Trade i.e., Igoria Trade and NGG go up and down completely randomly.

Pair Corralation between Igoria Trade and NGG

Assuming the 90 days trading horizon Igoria Trade SA is expected to generate 0.88 times more return on investment than NGG. However, Igoria Trade SA is 1.14 times less risky than NGG. It trades about -0.02 of its potential returns per unit of risk. NGG is currently generating about -0.12 per unit of risk. If you would invest  27.00  in Igoria Trade SA on September 15, 2024 and sell it today you would lose (2.00) from holding Igoria Trade SA or give up 7.41% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Igoria Trade SA  vs.  NGG

Igoria Trade SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Igoria Trade SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Igoria Trade is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

NGG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NGG has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Igoria Trade and NGG

The main advantage of trading using opposite Igoria Trade and NGG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Igoria Trade position performs unexpectedly, NGG 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 NGG will offset losses from the drop in NGG's long position.

The idea behind Igoria Trade SA and NGG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.