Correlation Between Canadian Imperial and Prosper Gold
Can any of the company-specific risk be diversified away by investing in both Canadian Imperial and Prosper Gold 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 Canadian Imperial and Prosper Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian Imperial Bank and Prosper Gold Corp, you can compare the effects of market volatilities on Canadian Imperial and Prosper Gold 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 Canadian Imperial with a short position of Prosper Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Imperial and Prosper Gold.
Diversification Opportunities for Canadian Imperial and Prosper Gold
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Canadian and Prosper is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Imperial Bank and Prosper Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosper Gold Corp and Canadian Imperial 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 Canadian Imperial Bank are associated (or correlated) with Prosper Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosper Gold Corp has no effect on the direction of Canadian Imperial i.e., Canadian Imperial and Prosper Gold go up and down completely randomly.
Pair Corralation between Canadian Imperial and Prosper Gold
Assuming the 90 days trading horizon Canadian Imperial Bank is expected to generate 0.12 times more return on investment than Prosper Gold. However, Canadian Imperial Bank is 8.43 times less risky than Prosper Gold. It trades about 0.19 of its potential returns per unit of risk. Prosper Gold Corp is currently generating about -0.01 per unit of risk. If you would invest 2,247 in Canadian Imperial Bank on September 14, 2024 and sell it today you would earn a total of 283.00 from holding Canadian Imperial Bank or generate 12.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Canadian Imperial Bank vs. Prosper Gold Corp
Performance |
| Timeline |
| Canadian Imperial Bank |
| Prosper Gold Corp |
Canadian Imperial and Prosper Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian Imperial and Prosper Gold
The main advantage of trading using opposite Canadian Imperial and Prosper Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Imperial position performs unexpectedly, Prosper Gold 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 Prosper Gold will offset losses from the drop in Prosper Gold's long position.| Canadian Imperial vs. Enbridge Pref 5 | Canadian Imperial vs. Enbridge Pref 11 | Canadian Imperial vs. Enbridge Pref L | Canadian Imperial vs. E Split Corp |
| Prosper Gold vs. Foraco International SA | Prosper Gold vs. Geodrill Limited | Prosper Gold vs. Major Drilling Group | Prosper Gold vs. Bri Chem Corp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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