Correlation Between Calian Technologies and Labrador Iron
Can any of the company-specific risk be diversified away by investing in both Calian Technologies and Labrador Iron 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 Calian Technologies and Labrador Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calian Technologies and Labrador Iron Ore, you can compare the effects of market volatilities on Calian Technologies and Labrador Iron 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 Calian Technologies with a short position of Labrador Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calian Technologies and Labrador Iron.
Diversification Opportunities for Calian Technologies and Labrador Iron
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Calian and Labrador is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Calian Technologies and Labrador Iron Ore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Labrador Iron Ore and Calian Technologies 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 Calian Technologies are associated (or correlated) with Labrador Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Labrador Iron Ore has no effect on the direction of Calian Technologies i.e., Calian Technologies and Labrador Iron go up and down completely randomly.
Pair Corralation between Calian Technologies and Labrador Iron
Assuming the 90 days trading horizon Calian Technologies is expected to under-perform the Labrador Iron. In addition to that, Calian Technologies is 1.1 times more volatile than Labrador Iron Ore. It trades about -0.03 of its total potential returns per unit of risk. Labrador Iron Ore is currently generating about 0.01 per unit of volatility. If you would invest 2,947 in Labrador Iron Ore on September 14, 2024 and sell it today you would earn a total of 63.00 from holding Labrador Iron Ore or generate 2.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calian Technologies vs. Labrador Iron Ore
Performance |
| Timeline |
| Calian Technologies |
| Labrador Iron Ore |
Calian Technologies and Labrador Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calian Technologies and Labrador Iron
The main advantage of trading using opposite Calian Technologies and Labrador Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calian Technologies position performs unexpectedly, Labrador Iron 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 Labrador Iron will offset losses from the drop in Labrador Iron's long position.| Calian Technologies vs. Flow Beverage Corp | Calian Technologies vs. iShares Canadian HYBrid | Calian Technologies vs. Altagas Cum Red | Calian Technologies vs. European Residential Real |
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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 Stocks Directory module to find actively traded stocks across global markets.
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