Correlation Between CAE and Sidus Space
Can any of the company-specific risk be diversified away by investing in both CAE and Sidus Space 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 CAE and Sidus Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CAE Inc and Sidus Space, you can compare the effects of market volatilities on CAE and Sidus Space 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 CAE with a short position of Sidus Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAE and Sidus Space.
Diversification Opportunities for CAE and Sidus Space
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CAE and Sidus is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding CAE Inc and Sidus Space in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sidus Space and CAE 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 CAE Inc are associated (or correlated) with Sidus Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sidus Space has no effect on the direction of CAE i.e., CAE and Sidus Space go up and down completely randomly.
Pair Corralation between CAE and Sidus Space
Considering the 90-day investment horizon CAE Inc is expected to generate 0.22 times more return on investment than Sidus Space. However, CAE Inc is 4.51 times less risky than Sidus Space. It trades about 0.05 of its potential returns per unit of risk. Sidus Space is currently generating about -0.03 per unit of risk. If you would invest 2,002 in CAE Inc on August 28, 2024 and sell it today you would earn a total of 328.00 from holding CAE Inc or generate 16.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CAE Inc vs. Sidus Space
Performance |
| Timeline |
| CAE Inc |
| Sidus Space |
CAE and Sidus Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAE and Sidus Space
The main advantage of trading using opposite CAE and Sidus Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAE position performs unexpectedly, Sidus Space 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 Sidus Space will offset losses from the drop in Sidus Space's long position.The idea behind CAE Inc and Sidus Space pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sidus Space vs. Intelligent Living Application | Sidus Space vs. Quoin Pharmaceuticals Ltd | Sidus Space vs. Kidpik Corp | Sidus Space vs. Virax Biolabs Group |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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