Correlation Between Armada Hflr and IGEN Networks

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

By analyzing existing cross correlation between Armada Hflr Pr and IGEN Networks Corp, you can compare the effects of market volatilities on Armada Hflr and IGEN Networks 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 Armada Hflr with a short position of IGEN Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and IGEN Networks.

Diversification Opportunities for Armada Hflr and IGEN Networks

0.0

Correlation Coefficient

Armada Hflr  IGEN Networks

Pay attention - limited upside

The 3 months correlation between Armada and IGEN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and IGEN Networks Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IGEN Networks Corp and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with IGEN Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IGEN Networks Corp has no effect on the direction of Armada Hflr i.e., Armada Hflr and IGEN Networks go up and down completely randomly.

Pair Corralation between Armada Hflr and IGEN Networks

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the IGEN Networks. But the stock apears to be less risky and, when comparing its historical volatility, Armada Hflr Pr is 33.11 times less risky than IGEN Networks. The stock trades about -0.01 of its potential returns per unit of risk. The IGEN Networks Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  0.12  in IGEN Networks Corp on December 4, 2024 and sell it today you would lose (0.11) from holding IGEN Networks Corp or give up 91.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

Armada Hflr Pr  vs.  IGEN Networks Corp

Armada Hflr Pr

Risk-Adjusted Performance

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

IGEN Networks Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days IGEN Networks Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, IGEN Networks is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Armada Hflr and IGEN Networks

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

The idea behind Armada Hflr Pr and IGEN Networks Corp 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.