Correlation Between Ares AcquisitionII and Canada Goose
Can any of the company-specific risk be diversified away by investing in both Ares AcquisitionII and Canada Goose 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 Ares AcquisitionII and Canada Goose into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ares Acquisition and Canada Goose Holdings, you can compare the effects of market volatilities on Ares AcquisitionII and Canada Goose 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 Ares AcquisitionII with a short position of Canada Goose. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ares AcquisitionII and Canada Goose.
Diversification Opportunities for Ares AcquisitionII and Canada Goose
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ares and Canada is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Ares Acquisition and Canada Goose Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canada Goose Holdings and Ares AcquisitionII 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 Ares Acquisition are associated (or correlated) with Canada Goose. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canada Goose Holdings has no effect on the direction of Ares AcquisitionII i.e., Ares AcquisitionII and Canada Goose go up and down completely randomly.
Pair Corralation between Ares AcquisitionII and Canada Goose
Assuming the 90 days trading horizon Ares AcquisitionII is expected to generate 1.7 times less return on investment than Canada Goose. But when comparing it to its historical volatility, Ares Acquisition is 2.77 times less risky than Canada Goose. It trades about 0.07 of its potential returns per unit of risk. Canada Goose Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,021 in Canada Goose Holdings on October 24, 2024 and sell it today you would earn a total of 40.00 from holding Canada Goose Holdings or generate 3.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ares Acquisition vs. Canada Goose Holdings
Performance |
| Timeline |
| Ares AcquisitionII |
| Canada Goose Holdings |
Ares AcquisitionII and Canada Goose Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ares AcquisitionII and Canada Goose
The main advantage of trading using opposite Ares AcquisitionII and Canada Goose positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ares AcquisitionII position performs unexpectedly, Canada Goose 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 Canada Goose will offset losses from the drop in Canada Goose's long position.| Ares AcquisitionII vs. Canada Goose Holdings | Ares AcquisitionII vs. Mangazeya Mining | Ares AcquisitionII vs. Cresud SACIF y | Ares AcquisitionII vs. VF Corporation |
| Canada Goose vs. PVH Corp | Canada Goose vs. VF Corporation | Canada Goose vs. Levi Strauss Co | Canada Goose vs. Under Armour A |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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