Correlation Between CI Financial and Kontoor Brands
Can any of the company-specific risk be diversified away by investing in both CI Financial and Kontoor Brands 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 Kontoor Brands 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 Kontoor Brands, you can compare the effects of market volatilities on CI Financial and Kontoor Brands 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 Kontoor Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Financial and Kontoor Brands.
Diversification Opportunities for CI Financial and Kontoor Brands
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between CIXXF and Kontoor is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding CI Financial Corp and Kontoor Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kontoor Brands 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 Kontoor Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kontoor Brands has no effect on the direction of CI Financial i.e., CI Financial and Kontoor Brands go up and down completely randomly.
Pair Corralation between CI Financial and Kontoor Brands
If you would invest 8,425 in Kontoor Brands on September 3, 2024 and sell it today you would earn a total of 994.00 from holding Kontoor Brands or generate 11.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
CI Financial Corp vs. Kontoor Brands
Performance |
| Timeline |
| CI Financial Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kontoor Brands |
CI Financial and Kontoor Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Financial and Kontoor Brands
The main advantage of trading using opposite CI Financial and Kontoor Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Financial position performs unexpectedly, Kontoor Brands 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 Kontoor Brands will offset losses from the drop in Kontoor Brands' long position.| CI Financial vs. Verra Mobility Corp | CI Financial vs. Zoom Video Communications | CI Financial vs. Digi International | CI Financial vs. Videolocity International |
| Kontoor Brands vs. Vince Holding Corp | Kontoor Brands vs. Ermenegildo Zegna NV | Kontoor Brands vs. Columbia Sportswear | Kontoor Brands vs. Gildan Activewear |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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