Correlation Between Aritzia and Reitmans Canada
Can any of the company-specific risk be diversified away by investing in both Aritzia and Reitmans Canada 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 Aritzia and Reitmans Canada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aritzia and Reitmans Canada, you can compare the effects of market volatilities on Aritzia and Reitmans Canada 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 Aritzia with a short position of Reitmans Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aritzia and Reitmans Canada.
Diversification Opportunities for Aritzia and Reitmans Canada
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aritzia and Reitmans is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Aritzia and Reitmans Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reitmans Canada and Aritzia 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 Aritzia are associated (or correlated) with Reitmans Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reitmans Canada has no effect on the direction of Aritzia i.e., Aritzia and Reitmans Canada go up and down completely randomly.
Pair Corralation between Aritzia and Reitmans Canada
Assuming the 90 days trading horizon Aritzia is expected to generate 0.79 times more return on investment than Reitmans Canada. However, Aritzia is 1.27 times less risky than Reitmans Canada. It trades about 0.12 of its potential returns per unit of risk. Reitmans Canada is currently generating about 0.0 per unit of risk. If you would invest 3,480 in Aritzia on December 4, 2024 and sell it today you would earn a total of 3,267 from holding Aritzia or generate 93.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aritzia vs. Reitmans Canada
Performance |
| Timeline |
| Aritzia |
| Reitmans Canada |
Aritzia and Reitmans Canada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aritzia and Reitmans Canada
The main advantage of trading using opposite Aritzia and Reitmans Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aritzia position performs unexpectedly, Reitmans Canada 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 Reitmans Canada will offset losses from the drop in Reitmans Canada's long position.| Aritzia vs. Canada Goose Holdings | Aritzia vs. Restaurant Brands International | Aritzia vs. Lightspeed Commerce | Aritzia vs. goeasy |
| Reitmans Canada vs. Reitmans Limited | Reitmans Canada vs. Supremex | Reitmans Canada vs. Inventronics | Reitmans Canada vs. Taiga Building Products |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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