Correlation Between Canon and LION ONE
Can any of the company-specific risk be diversified away by investing in both Canon and LION ONE 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 and LION ONE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canon Inc and LION ONE METALS, you can compare the effects of market volatilities on Canon and LION ONE 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 with a short position of LION ONE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canon and LION ONE.
Diversification Opportunities for Canon and LION ONE
Good diversification
The 3 months correlation between Canon and LION is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Canon Inc and LION ONE METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LION ONE METALS and Canon 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 Inc are associated (or correlated) with LION ONE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LION ONE METALS has no effect on the direction of Canon i.e., Canon and LION ONE go up and down completely randomly.
Pair Corralation between Canon and LION ONE
Assuming the 90 days trading horizon Canon Inc is expected to generate 0.4 times more return on investment than LION ONE. However, Canon Inc is 2.48 times less risky than LION ONE. It trades about 0.22 of its potential returns per unit of risk. LION ONE METALS is currently generating about -0.24 per unit of risk. If you would invest 2,880 in Canon Inc on September 5, 2024 and sell it today you would earn a total of 260.00 from holding Canon Inc or generate 9.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canon Inc vs. LION ONE METALS
Performance |
| Timeline |
| Canon Inc |
| LION ONE METALS |
Canon and LION ONE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canon and LION ONE
The main advantage of trading using opposite Canon and LION ONE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canon position performs unexpectedly, LION ONE 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 LION ONE will offset losses from the drop in LION ONE's long position.| Canon vs. LION ONE METALS | Canon vs. American Public Education | Canon vs. Xinhua Winshare Publishing | Canon vs. Zoom Video Communications |
| LION ONE vs. Jacquet Metal Service | LION ONE vs. Corsair Gaming | LION ONE vs. Pembina Pipeline Corp | LION ONE vs. DELTA AIR LINES |
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.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |