Correlation Between Cogeco Communications and Apple
Can any of the company-specific risk be diversified away by investing in both Cogeco Communications and Apple 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 Cogeco Communications and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cogeco Communications and Apple Inc CDR, you can compare the effects of market volatilities on Cogeco Communications and Apple 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 Cogeco Communications with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogeco Communications and Apple.
Diversification Opportunities for Cogeco Communications and Apple
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cogeco and Apple is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Cogeco Communications and Apple Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc CDR and Cogeco Communications 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 Cogeco Communications are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc CDR has no effect on the direction of Cogeco Communications i.e., Cogeco Communications and Apple go up and down completely randomly.
Pair Corralation between Cogeco Communications and Apple
Assuming the 90 days trading horizon Cogeco Communications is expected to under-perform the Apple. But the stock apears to be less risky and, when comparing its historical volatility, Cogeco Communications is 1.01 times less risky than Apple. The stock trades about -0.21 of its potential returns per unit of risk. The Apple Inc CDR is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 3,584 in Apple Inc CDR on November 7, 2024 and sell it today you would lose (183.00) from holding Apple Inc CDR or give up 5.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cogeco Communications vs. Apple Inc CDR
Performance |
| Timeline |
| Cogeco Communications |
| Apple Inc CDR |
Cogeco Communications and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cogeco Communications and Apple
The main advantage of trading using opposite Cogeco Communications and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogeco Communications position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| Cogeco Communications vs. Cogeco Inc | Cogeco Communications vs. Quebecor | Cogeco Communications vs. Transcontinental | Cogeco Communications vs. Stella Jones |
| Apple vs. Gamehost | Apple vs. Northstar Clean Technologies | Apple vs. TGS Esports | Apple vs. Economic Investment Trust |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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