Correlation Between Cleartronic and Ignis Petroleum

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

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

Diversification Opportunities for Cleartronic and Ignis Petroleum

0.0

Correlation Coefficient

Cleartronic  Ignis Petroleum

Pay attention - limited upside

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

Pair Corralation between Cleartronic and Ignis Petroleum

If you would invest  1.32  in Cleartronic on September 16, 2024 and sell it today you would lose (0.05) from holding Cleartronic or give up 3.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Cleartronic  vs.  Ignis Petroleum Group

Cleartronic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cleartronic has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Cleartronic is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Ignis Petroleum Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ignis Petroleum Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ignis Petroleum is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Cleartronic and Ignis Petroleum

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

The idea behind Cleartronic and Ignis Petroleum Group 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.