Correlation Between Canaf Investments and Arbor Metals
Can any of the company-specific risk be diversified away by investing in both Canaf Investments and Arbor Metals 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 Canaf Investments and Arbor Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canaf Investments and Arbor Metals Corp, you can compare the effects of market volatilities on Canaf Investments and Arbor Metals 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 Canaf Investments with a short position of Arbor Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canaf Investments and Arbor Metals.
Diversification Opportunities for Canaf Investments and Arbor Metals
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Canaf and Arbor is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Canaf Investments and Arbor Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbor Metals Corp and Canaf Investments 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 Canaf Investments are associated (or correlated) with Arbor Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbor Metals Corp has no effect on the direction of Canaf Investments i.e., Canaf Investments and Arbor Metals go up and down completely randomly.
Pair Corralation between Canaf Investments and Arbor Metals
Assuming the 90 days horizon Canaf Investments is expected to generate 0.94 times more return on investment than Arbor Metals. However, Canaf Investments is 1.06 times less risky than Arbor Metals. It trades about 0.07 of its potential returns per unit of risk. Arbor Metals Corp is currently generating about -0.08 per unit of risk. If you would invest 23.00 in Canaf Investments on August 24, 2024 and sell it today you would earn a total of 6.00 from holding Canaf Investments or generate 26.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canaf Investments vs. Arbor Metals Corp
Performance |
| Timeline |
| Canaf Investments |
| Arbor Metals Corp |
Canaf Investments and Arbor Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canaf Investments and Arbor Metals
The main advantage of trading using opposite Canaf Investments and Arbor Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canaf Investments position performs unexpectedly, Arbor Metals 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 Arbor Metals will offset losses from the drop in Arbor Metals' long position.| Canaf Investments vs. Fairfax Financial Holdings | Canaf Investments vs. US Financial 15 | Canaf Investments vs. Aurora Solar Technologies | Canaf Investments vs. Solar Alliance Energy |
| Arbor Metals vs. Fairfax Financial Holdings | Arbor Metals vs. US Financial 15 | Arbor Metals vs. Aurora Solar Technologies | Arbor Metals vs. Solar Alliance Energy |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |