Correlation Between Dream Office and Calian Technologies
Can any of the company-specific risk be diversified away by investing in both Dream Office and Calian Technologies 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 Dream Office and Calian Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dream Office Real and Calian Technologies, you can compare the effects of market volatilities on Dream Office and Calian Technologies 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 Dream Office with a short position of Calian Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dream Office and Calian Technologies.
Diversification Opportunities for Dream Office and Calian Technologies
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dream and Calian is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Dream Office Real and Calian Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calian Technologies and Dream Office 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 Dream Office Real are associated (or correlated) with Calian Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calian Technologies has no effect on the direction of Dream Office i.e., Dream Office and Calian Technologies go up and down completely randomly.
Pair Corralation between Dream Office and Calian Technologies
Assuming the 90 days trading horizon Dream Office Real is expected to under-perform the Calian Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Dream Office Real is 1.16 times less risky than Calian Technologies. The stock trades about -0.19 of its potential returns per unit of risk. The Calian Technologies is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 4,834 in Calian Technologies on September 13, 2024 and sell it today you would lose (20.00) from holding Calian Technologies or give up 0.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dream Office Real vs. Calian Technologies
Performance |
| Timeline |
| Dream Office Real |
| Calian Technologies |
Dream Office and Calian Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dream Office and Calian Technologies
The main advantage of trading using opposite Dream Office and Calian Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dream Office position performs unexpectedly, Calian Technologies 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 Calian Technologies will offset losses from the drop in Calian Technologies' long position.| Dream Office vs. Canadian Apartment Properties | Dream Office vs. Granite Real Estate | Dream Office vs. Choice Properties Real | Dream Office vs. HR Real Estate |
| Calian Technologies vs. Flow Beverage Corp | Calian Technologies vs. iShares Canadian HYBrid | Calian Technologies vs. Altagas Cum Red | Calian Technologies vs. European Residential Real |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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