Correlation Between CDN IMPERIAL and VIRGIN WINES
Can any of the company-specific risk be diversified away by investing in both CDN IMPERIAL and VIRGIN WINES 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 CDN IMPERIAL and VIRGIN WINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDN IMPERIAL BANK and VIRGIN WINES UK, you can compare the effects of market volatilities on CDN IMPERIAL and VIRGIN WINES 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 CDN IMPERIAL with a short position of VIRGIN WINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDN IMPERIAL and VIRGIN WINES.
Diversification Opportunities for CDN IMPERIAL and VIRGIN WINES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CDN and VIRGIN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CDN IMPERIAL BANK and VIRGIN WINES UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIRGIN WINES UK and CDN IMPERIAL 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 CDN IMPERIAL BANK are associated (or correlated) with VIRGIN WINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIRGIN WINES UK has no effect on the direction of CDN IMPERIAL i.e., CDN IMPERIAL and VIRGIN WINES go up and down completely randomly.
Pair Corralation between CDN IMPERIAL and VIRGIN WINES
If you would invest 5,800 in CDN IMPERIAL BANK on September 3, 2024 and sell it today you would earn a total of 319.00 from holding CDN IMPERIAL BANK or generate 5.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
CDN IMPERIAL BANK vs. VIRGIN WINES UK
Performance |
| Timeline |
| CDN IMPERIAL BANK |
| VIRGIN WINES UK |
CDN IMPERIAL and VIRGIN WINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDN IMPERIAL and VIRGIN WINES
The main advantage of trading using opposite CDN IMPERIAL and VIRGIN WINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDN IMPERIAL position performs unexpectedly, VIRGIN WINES 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 VIRGIN WINES will offset losses from the drop in VIRGIN WINES's long position.| CDN IMPERIAL vs. TOTAL GABON | CDN IMPERIAL vs. Walgreens Boots Alliance | CDN IMPERIAL vs. Peak Resources Limited |
| VIRGIN WINES vs. Unity Software | VIRGIN WINES vs. Magic Software Enterprises | VIRGIN WINES vs. Kaiser Aluminum | VIRGIN WINES vs. ARDAGH METAL PACDL 0001 |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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