Correlation Between Accord Financial and CI Financial
Can any of the company-specific risk be diversified away by investing in both Accord Financial and CI Financial 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 Accord Financial and CI Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accord Financial Corp and CI Financial Corp, you can compare the effects of market volatilities on Accord Financial and CI Financial 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 Accord Financial with a short position of CI Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accord Financial and CI Financial.
Diversification Opportunities for Accord Financial and CI Financial
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Accord and CIX is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Accord Financial Corp and CI Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Financial Corp and Accord 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 Accord Financial Corp are associated (or correlated) with CI Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Financial Corp has no effect on the direction of Accord Financial i.e., Accord Financial and CI Financial go up and down completely randomly.
Pair Corralation between Accord Financial and CI Financial
Assuming the 90 days trading horizon Accord Financial Corp is expected to generate 11.7 times more return on investment than CI Financial. However, Accord Financial is 11.7 times more volatile than CI Financial Corp. It trades about 0.05 of its potential returns per unit of risk. CI Financial Corp is currently generating about 0.31 per unit of risk. If you would invest 380.00 in Accord Financial Corp on October 24, 2024 and sell it today you would earn a total of 7.00 from holding Accord Financial Corp or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accord Financial Corp vs. CI Financial Corp
Performance |
| Timeline |
| Accord Financial Corp |
| CI Financial Corp |
Accord Financial and CI Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accord Financial and CI Financial
The main advantage of trading using opposite Accord Financial and CI Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accord Financial position performs unexpectedly, CI Financial 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 CI Financial will offset losses from the drop in CI Financial's long position.| Accord Financial vs. Algoma Central | Accord Financial vs. Clairvest Group | Accord Financial vs. Clarke Inc | Accord Financial vs. ADF Group |
| CI Financial vs. Clarke Inc | CI Financial vs. Guardian Capital Group | CI Financial vs. Accord Financial Corp | CI Financial vs. E L Financial Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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