Correlation Between Canso Select and Arbor Metals
Can any of the company-specific risk be diversified away by investing in both Canso Select and Arbor Metals 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 Canso Select and Arbor Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canso Select Opportunities and Arbor Metals Corp, you can compare the effects of market volatilities on Canso Select and Arbor Metals 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 Canso Select with a short position of Arbor Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canso Select and Arbor Metals.
Diversification Opportunities for Canso Select and Arbor Metals
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Canso and Arbor is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Canso Select Opportunities and Arbor Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbor Metals Corp and Canso Select 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 Canso Select Opportunities are associated (or correlated) with Arbor Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbor Metals Corp has no effect on the direction of Canso Select i.e., Canso Select and Arbor Metals go up and down completely randomly.
Pair Corralation between Canso Select and Arbor Metals
Assuming the 90 days trading horizon Canso Select Opportunities is expected to generate 0.52 times more return on investment than Arbor Metals. However, Canso Select Opportunities is 1.91 times less risky than Arbor Metals. It trades about 0.01 of its potential returns per unit of risk. Arbor Metals Corp is currently generating about -0.07 per unit of risk. If you would invest 240.00 in Canso Select Opportunities on August 26, 2024 and sell it today you would lose (15.00) from holding Canso Select Opportunities or give up 6.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.75% |
| Values | Daily Returns |
Canso Select Opportunities vs. Arbor Metals Corp
Performance |
| Timeline |
| Canso Select Opportu |
| Arbor Metals Corp |
Canso Select and Arbor Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canso Select and Arbor Metals
The main advantage of trading using opposite Canso Select and Arbor Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canso Select position performs unexpectedly, Arbor Metals 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 Arbor Metals will offset losses from the drop in Arbor Metals' long position.| Canso Select vs. NVIDIA CDR | Canso Select vs. Apple Inc CDR | Canso Select vs. Microsoft Corp CDR | Canso Select vs. Amazon CDR |
| Arbor Metals vs. First Majestic Silver | Arbor Metals vs. Ivanhoe Energy | Arbor Metals vs. Orezone Gold Corp | Arbor Metals vs. Faraday Copper Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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