Correlation Between Canlan Ice and Fluent
Can any of the company-specific risk be diversified away by investing in both Canlan Ice and Fluent 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 Fluent 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 Fluent Inc, you can compare the effects of market volatilities on Canlan Ice and Fluent 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 Fluent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canlan Ice and Fluent.
Diversification Opportunities for Canlan Ice and Fluent
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Canlan and Fluent is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Canlan Ice Sports and Fluent Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluent Inc 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 Fluent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluent Inc has no effect on the direction of Canlan Ice i.e., Canlan Ice and Fluent go up and down completely randomly.
Pair Corralation between Canlan Ice and Fluent
Assuming the 90 days horizon Canlan Ice Sports is expected to generate 0.03 times more return on investment than Fluent. However, Canlan Ice Sports is 33.91 times less risky than Fluent. It trades about 0.15 of its potential returns per unit of risk. Fluent Inc is currently generating about -0.03 per unit of risk. If you would invest 290.00 in Canlan Ice Sports on September 1, 2024 and sell it today you would earn a total of 7.00 from holding Canlan Ice Sports or generate 2.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canlan Ice Sports vs. Fluent Inc
Performance |
| Timeline |
| Canlan Ice Sports |
| Fluent Inc |
Canlan Ice and Fluent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canlan Ice and Fluent
The main advantage of trading using opposite Canlan Ice and Fluent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canlan Ice position performs unexpectedly, Fluent 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 Fluent will offset losses from the drop in Fluent's long position.| Canlan Ice vs. Philip Morris International | Canlan Ice vs. Ambev SA ADR | Canlan Ice vs. Japan Tobacco ADR | Canlan Ice vs. Compania Cervecerias Unidas |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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