Correlation Between Alfa Financial and Canon
Can any of the company-specific risk be diversified away by investing in both Alfa Financial and Canon 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 Alfa Financial and Canon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Financial Software and Canon Inc, you can compare the effects of market volatilities on Alfa Financial and Canon 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 Alfa Financial with a short position of Canon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and Canon.
Diversification Opportunities for Alfa Financial and Canon
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Alfa and Canon is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and Canon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canon Inc and Alfa Financial 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 Alfa Financial Software are associated (or correlated) with Canon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canon Inc has no effect on the direction of Alfa Financial i.e., Alfa Financial and Canon go up and down completely randomly.
Pair Corralation between Alfa Financial and Canon
Assuming the 90 days trading horizon Alfa Financial is expected to generate 1.39 times less return on investment than Canon. In addition to that, Alfa Financial is 1.26 times more volatile than Canon Inc. It trades about 0.08 of its total potential returns per unit of risk. Canon Inc is currently generating about 0.13 per unit of volatility. If you would invest 2,932 in Canon Inc on September 4, 2024 and sell it today you would earn a total of 143.00 from holding Canon Inc or generate 4.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alfa Financial Software vs. Canon Inc
Performance |
| Timeline |
| Alfa Financial Software |
| Canon Inc |
Alfa Financial and Canon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfa Financial and Canon
The main advantage of trading using opposite Alfa Financial and Canon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Financial position performs unexpectedly, Canon 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 Canon will offset losses from the drop in Canon's long position.| Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc |
| Canon vs. CyberArk Software | Canon vs. Alfa Financial Software | Canon vs. MEDICAL FACILITIES NEW | Canon vs. ONWARD MEDICAL BV |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |