Correlation Between CI GAMES and Air Canada
Can any of the company-specific risk be diversified away by investing in both CI GAMES and Air Canada 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 CI GAMES and Air Canada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI GAMES SA and Air Canada, you can compare the effects of market volatilities on CI GAMES and Air Canada 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 CI GAMES with a short position of Air Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI GAMES and Air Canada.
Diversification Opportunities for CI GAMES and Air Canada
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CI7 and Air is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding CI GAMES SA and Air Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Canada and CI GAMES 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 CI GAMES SA are associated (or correlated) with Air Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Canada has no effect on the direction of CI GAMES i.e., CI GAMES and Air Canada go up and down completely randomly.
Pair Corralation between CI GAMES and Air Canada
Assuming the 90 days horizon CI GAMES SA is expected to under-perform the Air Canada. But the stock apears to be less risky and, when comparing its historical volatility, CI GAMES SA is 1.06 times less risky than Air Canada. The stock trades about -0.13 of its potential returns per unit of risk. The Air Canada is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 1,273 in Air Canada on August 29, 2024 and sell it today you would earn a total of 393.00 from holding Air Canada or generate 30.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
CI GAMES SA vs. Air Canada
Performance |
| Timeline |
| CI GAMES SA |
| Air Canada |
CI GAMES and Air Canada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI GAMES and Air Canada
The main advantage of trading using opposite CI GAMES and Air Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI GAMES position performs unexpectedly, Air Canada 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 Air Canada will offset losses from the drop in Air Canada's long position.| CI GAMES vs. New Residential Investment | CI GAMES vs. SLR Investment Corp | CI GAMES vs. WisdomTree Investments | CI GAMES vs. Hyrican Informationssysteme Aktiengesellschaft |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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