Correlation Between CI Financial and Dominion Lending
Can any of the company-specific risk be diversified away by investing in both CI Financial and Dominion Lending 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 Financial and Dominion Lending into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Financial Corp and Dominion Lending Centres, you can compare the effects of market volatilities on CI Financial and Dominion Lending 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 Financial with a short position of Dominion Lending. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Financial and Dominion Lending.
Diversification Opportunities for CI Financial and Dominion Lending
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between CIX and Dominion is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding CI Financial Corp and Dominion Lending Centres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dominion Lending Centres and CI Financial 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 Financial Corp are associated (or correlated) with Dominion Lending. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dominion Lending Centres has no effect on the direction of CI Financial i.e., CI Financial and Dominion Lending go up and down completely randomly.
Pair Corralation between CI Financial and Dominion Lending
Assuming the 90 days trading horizon CI Financial Corp is expected to generate 0.14 times more return on investment than Dominion Lending. However, CI Financial Corp is 7.12 times less risky than Dominion Lending. It trades about 0.31 of its potential returns per unit of risk. Dominion Lending Centres is currently generating about -0.02 per unit of risk. If you would invest 3,069 in CI Financial Corp on October 23, 2024 and sell it today you would earn a total of 38.00 from holding CI Financial Corp or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
CI Financial Corp vs. Dominion Lending Centres
Performance |
| Timeline |
| CI Financial Corp |
| Dominion Lending Centres |
CI Financial and Dominion Lending Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Financial and Dominion Lending
The main advantage of trading using opposite CI Financial and Dominion Lending positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Financial position performs unexpectedly, Dominion Lending 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 Dominion Lending will offset losses from the drop in Dominion Lending's long position.| CI Financial vs. IGM Financial | CI Financial vs. iA Financial | CI Financial vs. Canadian Western Bank | CI Financial vs. Great West Lifeco |
| Dominion Lending vs. Titanium Transportation Group | Dominion Lending vs. Alignvest Acquisition II | Dominion Lending vs. Propel Holdings | Dominion Lending vs. Dexterra Group |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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