Correlation Between CANON MARKETING and Atea ASA
Can any of the company-specific risk be diversified away by investing in both CANON MARKETING and Atea ASA 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 CANON MARKETING and Atea ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CANON MARKETING JP and Atea ASA, you can compare the effects of market volatilities on CANON MARKETING and Atea ASA 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 CANON MARKETING with a short position of Atea ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CANON MARKETING and Atea ASA.
Diversification Opportunities for CANON MARKETING and Atea ASA
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CANON and Atea is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding CANON MARKETING JP and Atea ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atea ASA and CANON MARKETING 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 CANON MARKETING JP are associated (or correlated) with Atea ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atea ASA has no effect on the direction of CANON MARKETING i.e., CANON MARKETING and Atea ASA go up and down completely randomly.
Pair Corralation between CANON MARKETING and Atea ASA
Assuming the 90 days trading horizon CANON MARKETING is expected to generate 2.63 times less return on investment than Atea ASA. But when comparing it to its historical volatility, CANON MARKETING JP is 2.41 times less risky than Atea ASA. It trades about 0.09 of its potential returns per unit of risk. Atea ASA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 515.00 in Atea ASA on September 14, 2024 and sell it today you would earn a total of 687.00 from holding Atea ASA or generate 133.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.64% |
| Values | Daily Returns |
CANON MARKETING JP vs. Atea ASA
Performance |
| Timeline |
| CANON MARKETING JP |
| Atea ASA |
CANON MARKETING and Atea ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CANON MARKETING and Atea ASA
The main advantage of trading using opposite CANON MARKETING and Atea ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CANON MARKETING position performs unexpectedly, Atea ASA 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 Atea ASA will offset losses from the drop in Atea ASA's long position.| CANON MARKETING vs. Apple Inc | CANON MARKETING vs. Apple Inc | CANON MARKETING vs. Apple Inc | CANON MARKETING vs. Apple Inc |
| Atea ASA vs. Automatic Data Processing | Atea ASA vs. Public Storage | Atea ASA vs. FAST RETAIL ADR | Atea ASA vs. CANON MARKETING JP |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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