Correlation Between Canso Select and Xtract One
Can any of the company-specific risk be diversified away by investing in both Canso Select and Xtract 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 Canso Select and Xtract One 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 Xtract One Technologies, you can compare the effects of market volatilities on Canso Select and Xtract 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 Canso Select with a short position of Xtract One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canso Select and Xtract One.
Diversification Opportunities for Canso Select and Xtract One
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Canso and Xtract is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Canso Select Opportunities and Xtract One Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtract One Technologies 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 Xtract One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtract One Technologies has no effect on the direction of Canso Select i.e., Canso Select and Xtract One go up and down completely randomly.
Pair Corralation between Canso Select and Xtract One
Assuming the 90 days trading horizon Canso Select Opportunities is expected to generate 1.73 times more return on investment than Xtract One. However, Canso Select is 1.73 times more volatile than Xtract One Technologies. It trades about 0.02 of its potential returns per unit of risk. Xtract One Technologies is currently generating about -0.01 per unit of risk. If you would invest 227.00 in Canso Select Opportunities on August 24, 2024 and sell it today you would lose (2.00) from holding Canso Select Opportunities or give up 0.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Canso Select Opportunities vs. Xtract One Technologies
Performance |
| Timeline |
| Canso Select Opportu |
| Xtract One Technologies |
Canso Select and Xtract One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canso Select and Xtract One
The main advantage of trading using opposite Canso Select and Xtract One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canso Select position performs unexpectedly, Xtract 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 Xtract One will offset losses from the drop in Xtract One's long position.| Canso Select vs. Walmart Inc CDR | Canso Select vs. Amazon CDR | Canso Select vs. UPS CDR | Canso Select vs. HOME DEPOT CDR |
| Xtract One vs. Forstrong Global Income | Xtract One vs. Terreno Resources Corp | Xtract One vs. iShares Canadian HYBrid | Xtract One vs. Brompton European Dividend |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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