Correlation Between Canadian General and Ucore Rare
Can any of the company-specific risk be diversified away by investing in both Canadian General and Ucore Rare 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 Ucore Rare 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 Ucore Rare Metals, you can compare the effects of market volatilities on Canadian General and Ucore Rare 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 Ucore Rare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian General and Ucore Rare.
Diversification Opportunities for Canadian General and Ucore Rare
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Canadian and Ucore is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Canadian General Investments and Ucore Rare Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ucore Rare Metals 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 Ucore Rare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ucore Rare Metals has no effect on the direction of Canadian General i.e., Canadian General and Ucore Rare go up and down completely randomly.
Pair Corralation between Canadian General and Ucore Rare
Assuming the 90 days trading horizon Canadian General Investments is expected to generate 0.24 times more return on investment than Ucore Rare. However, Canadian General Investments is 4.25 times less risky than Ucore Rare. It trades about 0.05 of its potential returns per unit of risk. Ucore Rare Metals is currently generating about 0.01 per unit of risk. If you would invest 3,186 in Canadian General Investments on October 14, 2024 and sell it today you would earn a total of 864.00 from holding Canadian General Investments or generate 27.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canadian General Investments vs. Ucore Rare Metals
Performance |
| Timeline |
| Canadian General Inv |
| Ucore Rare Metals |
Canadian General and Ucore Rare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian General and Ucore Rare
The main advantage of trading using opposite Canadian General and Ucore Rare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian General position performs unexpectedly, Ucore Rare 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 Ucore Rare will offset losses from the drop in Ucore Rare'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 |
| Ucore Rare vs. Ocumetics Technology Corp | Ucore Rare vs. Quorum Information Technologies | Ucore Rare vs. Canaf Investments | Ucore Rare vs. Canadian General Investments |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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