Correlation Between Earth Alive and Laurentian Bank
Can any of the company-specific risk be diversified away by investing in both Earth Alive and Laurentian Bank 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 Earth Alive and Laurentian Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Earth Alive Clean and Laurentian Bank, you can compare the effects of market volatilities on Earth Alive and Laurentian Bank 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 Earth Alive with a short position of Laurentian Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Earth Alive and Laurentian Bank.
Diversification Opportunities for Earth Alive and Laurentian Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Earth and Laurentian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Earth Alive Clean and Laurentian Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laurentian Bank and Earth Alive 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 Earth Alive Clean are associated (or correlated) with Laurentian Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laurentian Bank has no effect on the direction of Earth Alive i.e., Earth Alive and Laurentian Bank go up and down completely randomly.
Pair Corralation between Earth Alive and Laurentian Bank
If you would invest 2,708 in Laurentian Bank on September 13, 2024 and sell it today you would earn a total of 319.00 from holding Laurentian Bank or generate 11.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Earth Alive Clean vs. Laurentian Bank
Performance |
| Timeline |
| Earth Alive Clean |
| Laurentian Bank |
Earth Alive and Laurentian Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Earth Alive and Laurentian Bank
The main advantage of trading using opposite Earth Alive and Laurentian Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Earth Alive position performs unexpectedly, Laurentian Bank 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 Laurentian Bank will offset losses from the drop in Laurentian Bank's long position.| Earth Alive vs. Orbit Garant Drilling | Earth Alive vs. NextSource Materials | Earth Alive vs. Electra Battery Materials | Earth Alive vs. SalesforceCom CDR |
| Laurentian Bank vs. Sylogist | Laurentian Bank vs. Sangoma Technologies Corp | Laurentian Bank vs. Firan Technology Group | Laurentian Bank vs. iShares Canadian HYBrid |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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