Correlation Between CDN IMPERIAL and COMINTL BANK
Can any of the company-specific risk be diversified away by investing in both CDN IMPERIAL and COMINTL BANK 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 COMINTL BANK 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 COMINTL BANK ADR1, you can compare the effects of market volatilities on CDN IMPERIAL and COMINTL BANK 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 COMINTL BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDN IMPERIAL and COMINTL BANK.
Diversification Opportunities for CDN IMPERIAL and COMINTL BANK
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CDN and COMINTL is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding CDN IMPERIAL BANK and COMINTL BANK ADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMINTL BANK ADR1 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 COMINTL BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMINTL BANK ADR1 has no effect on the direction of CDN IMPERIAL i.e., CDN IMPERIAL and COMINTL BANK go up and down completely randomly.
Pair Corralation between CDN IMPERIAL and COMINTL BANK
Assuming the 90 days trading horizon CDN IMPERIAL BANK is expected to generate 0.32 times more return on investment than COMINTL BANK. However, CDN IMPERIAL BANK is 3.16 times less risky than COMINTL BANK. It trades about 0.38 of its potential returns per unit of risk. COMINTL BANK ADR1 is currently generating about 0.09 per unit of risk. If you would invest 5,855 in CDN IMPERIAL BANK on August 27, 2024 and sell it today you would earn a total of 388.00 from holding CDN IMPERIAL BANK or generate 6.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CDN IMPERIAL BANK vs. COMINTL BANK ADR1
Performance |
| Timeline |
| CDN IMPERIAL BANK |
| COMINTL BANK ADR1 |
CDN IMPERIAL and COMINTL BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDN IMPERIAL and COMINTL BANK
The main advantage of trading using opposite CDN IMPERIAL and COMINTL BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDN IMPERIAL position performs unexpectedly, COMINTL BANK 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 COMINTL BANK will offset losses from the drop in COMINTL BANK's long position.| CDN IMPERIAL vs. Apple Inc | CDN IMPERIAL vs. Apple Inc | CDN IMPERIAL vs. Apple Inc | CDN IMPERIAL vs. Microsoft |
| COMINTL BANK vs. AWILCO DRILLING PLC | COMINTL BANK vs. Tradeweb Markets | COMINTL BANK vs. PRECISION DRILLING P | COMINTL BANK vs. Major Drilling 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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