Correlation Between Canadian General and Travel Leisure
Can any of the company-specific risk be diversified away by investing in both Canadian General and Travel Leisure 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 Canadian General and Travel Leisure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian General Investments and Travel Leisure Co, you can compare the effects of market volatilities on Canadian General and Travel Leisure 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 Canadian General with a short position of Travel Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian General and Travel Leisure.
Diversification Opportunities for Canadian General and Travel Leisure
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Canadian and Travel is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Canadian General Investments and Travel Leisure Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Travel Leisure and Canadian General 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 Canadian General Investments are associated (or correlated) with Travel Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Travel Leisure has no effect on the direction of Canadian General i.e., Canadian General and Travel Leisure go up and down completely randomly.
Pair Corralation between Canadian General and Travel Leisure
If you would invest 226,000 in Canadian General Investments on November 4, 2024 and sell it today you would earn a total of 7,000 from holding Canadian General Investments or generate 3.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canadian General Investments vs. Travel Leisure Co
Performance |
| Timeline |
| Canadian General Inv |
| Travel Leisure |
Canadian General and Travel Leisure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian General and Travel Leisure
The main advantage of trading using opposite Canadian General and Travel Leisure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian General position performs unexpectedly, Travel Leisure 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 Travel Leisure will offset losses from the drop in Travel Leisure's long position.| Canadian General vs. Spotify Technology SA | Canadian General vs. Monster Beverage Corp | Canadian General vs. Ebro Foods | Canadian General vs. National Beverage Corp |
| Travel Leisure vs. Qurate Retail Series | Travel Leisure vs. Pfeiffer Vacuum Technology | Travel Leisure vs. GoldMining | Travel Leisure vs. Hecla Mining Co |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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