Correlation Between Canlan Ice and Distoken Acquisition
Can any of the company-specific risk be diversified away by investing in both Canlan Ice and Distoken Acquisition 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 Distoken Acquisition 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 Distoken Acquisition, you can compare the effects of market volatilities on Canlan Ice and Distoken Acquisition 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 Distoken Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canlan Ice and Distoken Acquisition.
Diversification Opportunities for Canlan Ice and Distoken Acquisition
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Canlan and Distoken is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Canlan Ice Sports and Distoken Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Distoken Acquisition 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 Distoken Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Distoken Acquisition has no effect on the direction of Canlan Ice i.e., Canlan Ice and Distoken Acquisition go up and down completely randomly.
Pair Corralation between Canlan Ice and Distoken Acquisition
Assuming the 90 days horizon Canlan Ice Sports is expected to generate 1.59 times more return on investment than Distoken Acquisition. However, Canlan Ice is 1.59 times more volatile than Distoken Acquisition. It trades about 0.23 of its potential returns per unit of risk. Distoken Acquisition is currently generating about -0.24 per unit of risk. If you would invest 294.00 in Canlan Ice Sports on October 29, 2024 and sell it today you would earn a total of 3.00 from holding Canlan Ice Sports or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Canlan Ice Sports vs. Distoken Acquisition
Performance |
| Timeline |
| Canlan Ice Sports |
| Distoken Acquisition |
Canlan Ice and Distoken Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canlan Ice and Distoken Acquisition
The main advantage of trading using opposite Canlan Ice and Distoken Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canlan Ice position performs unexpectedly, Distoken Acquisition 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 Distoken Acquisition will offset losses from the drop in Distoken Acquisition's long position.| Canlan Ice vs. Oatly Group AB | Canlan Ice vs. Fernhill Beverage | Canlan Ice vs. Willamette Valley Vineyards | Canlan Ice vs. Mesa Air Group |
| Distoken Acquisition vs. Emerson Radio | Distoken Acquisition vs. Fernhill Beverage | Distoken Acquisition vs. Vita Coco | Distoken Acquisition vs. Nexstar Broadcasting Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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