Correlation Between CITY OFFICE and CN MODERN
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and CN MODERN 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 CITY OFFICE and CN MODERN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and CN MODERN DAIRY, you can compare the effects of market volatilities on CITY OFFICE and CN MODERN 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 CITY OFFICE with a short position of CN MODERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and CN MODERN.
Diversification Opportunities for CITY OFFICE and CN MODERN
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CITY and 07M is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and CN MODERN DAIRY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN MODERN DAIRY and CITY OFFICE 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 CITY OFFICE REIT are associated (or correlated) with CN MODERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN MODERN DAIRY has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and CN MODERN go up and down completely randomly.
Pair Corralation between CITY OFFICE and CN MODERN
Assuming the 90 days horizon CITY OFFICE REIT is expected to under-perform the CN MODERN. But the stock apears to be less risky and, when comparing its historical volatility, CITY OFFICE REIT is 2.49 times less risky than CN MODERN. The stock trades about -0.08 of its potential returns per unit of risk. The CN MODERN DAIRY is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 9.75 in CN MODERN DAIRY on October 11, 2024 and sell it today you would earn a total of 0.20 from holding CN MODERN DAIRY or generate 2.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITY OFFICE REIT vs. CN MODERN DAIRY
Performance |
| Timeline |
| CITY OFFICE REIT |
| CN MODERN DAIRY |
CITY OFFICE and CN MODERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and CN MODERN
The main advantage of trading using opposite CITY OFFICE and CN MODERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, CN MODERN 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 CN MODERN will offset losses from the drop in CN MODERN's long position.| CITY OFFICE vs. Tradeweb Markets | CITY OFFICE vs. CARSALESCOM | CITY OFFICE vs. Tower Semiconductor | CITY OFFICE vs. ELMOS SEMICONDUCTOR |
| CN MODERN vs. CITY OFFICE REIT | CN MODERN vs. ANTA SPORTS PRODUCT | CN MODERN vs. SPORT LISBOA E | CN MODERN vs. SOEDER SPORTFISKE AB |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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