Correlation Between Accord Financial and Guardian Capital
Can any of the company-specific risk be diversified away by investing in both Accord Financial and Guardian Capital 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 Guardian Capital 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 Guardian Capital Group, you can compare the effects of market volatilities on Accord Financial and Guardian Capital 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 Guardian Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accord Financial and Guardian Capital.
Diversification Opportunities for Accord Financial and Guardian Capital
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Accord and Guardian is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Accord Financial Corp and Guardian Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Capital 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 Guardian Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Capital has no effect on the direction of Accord Financial i.e., Accord Financial and Guardian Capital go up and down completely randomly.
Pair Corralation between Accord Financial and Guardian Capital
Assuming the 90 days trading horizon Accord Financial Corp is expected to under-perform the Guardian Capital. In addition to that, Accord Financial is 1.22 times more volatile than Guardian Capital Group. It trades about -0.01 of its total potential returns per unit of risk. Guardian Capital Group is currently generating about 0.09 per unit of volatility. If you would invest 4,032 in Guardian Capital Group on August 28, 2024 and sell it today you would earn a total of 168.00 from holding Guardian Capital Group or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accord Financial Corp vs. Guardian Capital Group
Performance |
| Timeline |
| Accord Financial Corp |
| Guardian Capital |
Accord Financial and Guardian Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accord Financial and Guardian Capital
The main advantage of trading using opposite Accord Financial and Guardian Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accord Financial position performs unexpectedly, Guardian Capital 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 Guardian Capital will offset losses from the drop in Guardian Capital's long position.| Accord Financial vs. NVIDIA CDR | Accord Financial vs. Apple Inc CDR | Accord Financial vs. Microsoft Corp CDR | Accord Financial vs. Amazon CDR |
| Guardian Capital vs. Guardian Capital Group | Guardian Capital vs. Clairvest Group | Guardian Capital vs. E L Financial Corp | Guardian Capital vs. Accord 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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