Correlation Between CI Financial and Baselode Energy
Can any of the company-specific risk be diversified away by investing in both CI Financial and Baselode Energy 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 Baselode Energy 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 Baselode Energy Corp, you can compare the effects of market volatilities on CI Financial and Baselode Energy 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 Baselode Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Financial and Baselode Energy.
Diversification Opportunities for CI Financial and Baselode Energy
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CIX and Baselode is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding CI Financial Corp and Baselode Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baselode Energy Corp 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 Baselode Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baselode Energy Corp has no effect on the direction of CI Financial i.e., CI Financial and Baselode Energy go up and down completely randomly.
Pair Corralation between CI Financial and Baselode Energy
Assuming the 90 days trading horizon CI Financial Corp is expected to generate 0.49 times more return on investment than Baselode Energy. However, CI Financial Corp is 2.05 times less risky than Baselode Energy. It trades about 0.08 of its potential returns per unit of risk. Baselode Energy Corp is currently generating about -0.03 per unit of risk. If you would invest 1,258 in CI Financial Corp on September 3, 2024 and sell it today you would earn a total of 1,847 from holding CI Financial Corp or generate 146.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Financial Corp vs. Baselode Energy Corp
Performance |
| Timeline |
| CI Financial Corp |
| Baselode Energy Corp |
CI Financial and Baselode Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Financial and Baselode Energy
The main advantage of trading using opposite CI Financial and Baselode Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Financial position performs unexpectedly, Baselode Energy 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 Baselode Energy will offset losses from the drop in Baselode Energy'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 |
| Baselode Energy vs. Dream Office Real | Baselode Energy vs. Brookfield Office Properties | Baselode Energy vs. Bragg Gaming Group | Baselode Energy vs. Maple Leaf Foods |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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