Correlation Between Element Fleet and Corus Entertainment
Can any of the company-specific risk be diversified away by investing in both Element Fleet and Corus Entertainment 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 Element Fleet and Corus Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Element Fleet Management and Corus Entertainment, you can compare the effects of market volatilities on Element Fleet and Corus Entertainment 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 Element Fleet with a short position of Corus Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Element Fleet and Corus Entertainment.
Diversification Opportunities for Element Fleet and Corus Entertainment
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Element and Corus is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Element Fleet Management and Corus Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corus Entertainment and Element Fleet 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 Element Fleet Management are associated (or correlated) with Corus Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corus Entertainment has no effect on the direction of Element Fleet i.e., Element Fleet and Corus Entertainment go up and down completely randomly.
Pair Corralation between Element Fleet and Corus Entertainment
Assuming the 90 days trading horizon Element Fleet Management is expected to generate 0.24 times more return on investment than Corus Entertainment. However, Element Fleet Management is 4.17 times less risky than Corus Entertainment. It trades about -0.09 of its potential returns per unit of risk. Corus Entertainment is currently generating about -0.07 per unit of risk. If you would invest 2,923 in Element Fleet Management on November 3, 2024 and sell it today you would lose (68.00) from holding Element Fleet Management or give up 2.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Element Fleet Management vs. Corus Entertainment
Performance |
| Timeline |
| Element Fleet Management |
| Corus Entertainment |
Element Fleet and Corus Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Element Fleet and Corus Entertainment
The main advantage of trading using opposite Element Fleet and Corus Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Element Fleet position performs unexpectedly, Corus Entertainment 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 Corus Entertainment will offset losses from the drop in Corus Entertainment's long position.| Element Fleet vs. ECN Capital Corp | Element Fleet vs. Martinrea International | Element Fleet vs. CCL Industries | Element Fleet vs. FirstService Corp |
| Corus Entertainment vs. AltaGas | Corus Entertainment vs. Transcontinental | Corus Entertainment vs. NorthWest Healthcare Properties | Corus Entertainment vs. Aecon Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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