Correlation Between Canadian General and Slate Grocery
Can any of the company-specific risk be diversified away by investing in both Canadian General and Slate Grocery 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 Slate Grocery 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 Slate Grocery REIT, you can compare the effects of market volatilities on Canadian General and Slate Grocery 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 Slate Grocery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian General and Slate Grocery.
Diversification Opportunities for Canadian General and Slate Grocery
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Canadian and Slate is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Canadian General Investments and Slate Grocery REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Grocery REIT 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 Slate Grocery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Grocery REIT has no effect on the direction of Canadian General i.e., Canadian General and Slate Grocery go up and down completely randomly.
Pair Corralation between Canadian General and Slate Grocery
Assuming the 90 days trading horizon Canadian General is expected to generate 4.41 times less return on investment than Slate Grocery. But when comparing it to its historical volatility, Canadian General Investments is 1.77 times less risky than Slate Grocery. It trades about 0.06 of its potential returns per unit of risk. Slate Grocery REIT is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 996.00 in Slate Grocery REIT on August 26, 2024 and sell it today you would earn a total of 56.00 from holding Slate Grocery REIT or generate 5.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canadian General Investments vs. Slate Grocery REIT
Performance |
| Timeline |
| Canadian General Inv |
| Slate Grocery REIT |
Canadian General and Slate Grocery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian General and Slate Grocery
The main advantage of trading using opposite Canadian General and Slate Grocery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian General position performs unexpectedly, Slate Grocery 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 Slate Grocery will offset losses from the drop in Slate Grocery's long position.| Canadian General vs. Uniteds Limited | Canadian General vs. Economic Investment Trust | Canadian General vs. abrdn Asia Pacific | Canadian General vs. Clairvest Group |
| Slate Grocery vs. Primaris Retail RE | Slate Grocery vs. High Liner Foods | Slate Grocery vs. Canadian General Investments | Slate Grocery vs. Western Investment |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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