Correlation Between BORR DRILLING and CDN IMPERIAL
Can any of the company-specific risk be diversified away by investing in both BORR DRILLING and CDN IMPERIAL 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 BORR DRILLING and CDN IMPERIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BORR DRILLING NEW and CDN IMPERIAL BANK, you can compare the effects of market volatilities on BORR DRILLING and CDN IMPERIAL 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 BORR DRILLING with a short position of CDN IMPERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BORR DRILLING and CDN IMPERIAL.
Diversification Opportunities for BORR DRILLING and CDN IMPERIAL
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BORR and CDN is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding BORR DRILLING NEW and CDN IMPERIAL BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN IMPERIAL BANK and BORR DRILLING 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 BORR DRILLING NEW are associated (or correlated) with CDN IMPERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN IMPERIAL BANK has no effect on the direction of BORR DRILLING i.e., BORR DRILLING and CDN IMPERIAL go up and down completely randomly.
Pair Corralation between BORR DRILLING and CDN IMPERIAL
Assuming the 90 days horizon BORR DRILLING NEW is expected to under-perform the CDN IMPERIAL. In addition to that, BORR DRILLING is 4.92 times more volatile than CDN IMPERIAL BANK. It trades about -0.05 of its total potential returns per unit of risk. CDN IMPERIAL BANK is currently generating about 0.33 per unit of volatility. If you would invest 5,758 in CDN IMPERIAL BANK on September 1, 2024 and sell it today you would earn a total of 361.00 from holding CDN IMPERIAL BANK or generate 6.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BORR DRILLING NEW vs. CDN IMPERIAL BANK
Performance |
| Timeline |
| BORR DRILLING NEW |
| CDN IMPERIAL BANK |
BORR DRILLING and CDN IMPERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BORR DRILLING and CDN IMPERIAL
The main advantage of trading using opposite BORR DRILLING and CDN IMPERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BORR DRILLING position performs unexpectedly, CDN IMPERIAL 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 CDN IMPERIAL will offset losses from the drop in CDN IMPERIAL's long position.| BORR DRILLING vs. PRECISION DRILLING P | BORR DRILLING vs. SHELF DRILLING LTD | BORR DRILLING vs. Daldrup Shne Aktiengesellschaft | BORR DRILLING vs. Superior Plus Corp |
| CDN IMPERIAL vs. Perseus Mining Limited | CDN IMPERIAL vs. ECHO INVESTMENT ZY | CDN IMPERIAL vs. LION ONE METALS | CDN IMPERIAL vs. GREENX METALS LTD |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |