Correlation Between Canaf Investments and Chemtrade Logistics
Can any of the company-specific risk be diversified away by investing in both Canaf Investments and Chemtrade Logistics 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 Chemtrade Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canaf Investments and Chemtrade Logistics Income, you can compare the effects of market volatilities on Canaf Investments and Chemtrade Logistics 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 Chemtrade Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canaf Investments and Chemtrade Logistics.
Diversification Opportunities for Canaf Investments and Chemtrade Logistics
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Canaf and Chemtrade is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Canaf Investments and Chemtrade Logistics Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemtrade Logistics 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 Chemtrade Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemtrade Logistics has no effect on the direction of Canaf Investments i.e., Canaf Investments and Chemtrade Logistics go up and down completely randomly.
Pair Corralation between Canaf Investments and Chemtrade Logistics
Assuming the 90 days horizon Canaf Investments is expected to generate 2.96 times more return on investment than Chemtrade Logistics. However, Canaf Investments is 2.96 times more volatile than Chemtrade Logistics Income. It trades about 0.11 of its potential returns per unit of risk. Chemtrade Logistics Income is currently generating about 0.07 per unit of risk. If you would invest 17.00 in Canaf Investments on November 3, 2024 and sell it today you would earn a total of 22.00 from holding Canaf Investments or generate 129.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canaf Investments vs. Chemtrade Logistics Income
Performance |
| Timeline |
| Canaf Investments |
| Chemtrade Logistics |
Canaf Investments and Chemtrade Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canaf Investments and Chemtrade Logistics
The main advantage of trading using opposite Canaf Investments and Chemtrade Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canaf Investments position performs unexpectedly, Chemtrade Logistics 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 Chemtrade Logistics will offset losses from the drop in Chemtrade Logistics' long position.| Canaf Investments vs. Dream Industrial Real | Canaf Investments vs. Western Copper and | Canaf Investments vs. Magna Mining | Canaf Investments vs. Metalero Mining Corp |
| Chemtrade Logistics vs. Extendicare | Chemtrade Logistics vs. NorthWest Healthcare Properties | Chemtrade Logistics vs. Exchange Income | Chemtrade Logistics vs. Freehold Royalties |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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