Correlation Between Canlan Ice and Affiliated Resources
Can any of the company-specific risk be diversified away by investing in both Canlan Ice and Affiliated Resources 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 Canlan Ice and Affiliated Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canlan Ice Sports and Affiliated Resources Corp, you can compare the effects of market volatilities on Canlan Ice and Affiliated Resources 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 Canlan Ice with a short position of Affiliated Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canlan Ice and Affiliated Resources.
Diversification Opportunities for Canlan Ice and Affiliated Resources
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Canlan and Affiliated is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Canlan Ice Sports and Affiliated Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affiliated Resources Corp and Canlan Ice 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 Canlan Ice Sports are associated (or correlated) with Affiliated Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affiliated Resources Corp has no effect on the direction of Canlan Ice i.e., Canlan Ice and Affiliated Resources go up and down completely randomly.
Pair Corralation between Canlan Ice and Affiliated Resources
Assuming the 90 days horizon Canlan Ice is expected to generate 7.24 times less return on investment than Affiliated Resources. But when comparing it to its historical volatility, Canlan Ice Sports is 89.34 times less risky than Affiliated Resources. It trades about 0.13 of its potential returns per unit of risk. Affiliated Resources Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 9.00 in Affiliated Resources Corp on October 24, 2024 and sell it today you would lose (2.52) from holding Affiliated Resources Corp or give up 28.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.36% |
| Values | Daily Returns |
Canlan Ice Sports vs. Affiliated Resources Corp
Performance |
| Timeline |
| Canlan Ice Sports |
| Affiliated Resources Corp |
Canlan Ice and Affiliated Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canlan Ice and Affiliated Resources
The main advantage of trading using opposite Canlan Ice and Affiliated Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canlan Ice position performs unexpectedly, Affiliated Resources 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 Affiliated Resources will offset losses from the drop in Affiliated Resources' long position.| Canlan Ice vs. Aquestive Therapeutics | Canlan Ice vs. Verra Mobility Corp | Canlan Ice vs. Viemed Healthcare | Canlan Ice vs. HUTCHMED DRC |
| Affiliated Resources vs. Catalyst Bancorp | Affiliated Resources vs. Lindblad Expeditions Holdings | Affiliated Resources vs. Norfolk Southern | Affiliated Resources vs. Canlan Ice Sports |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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