Correlation Between Exchange Income and Cargojet
Can any of the company-specific risk be diversified away by investing in both Exchange Income and Cargojet 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 Exchange Income and Cargojet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exchange Income and Cargojet, you can compare the effects of market volatilities on Exchange Income and Cargojet 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 Exchange Income with a short position of Cargojet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exchange Income and Cargojet.
Diversification Opportunities for Exchange Income and Cargojet
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Exchange and Cargojet is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Exchange Income and Cargojet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cargojet and Exchange Income 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 Exchange Income are associated (or correlated) with Cargojet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cargojet has no effect on the direction of Exchange Income i.e., Exchange Income and Cargojet go up and down completely randomly.
Pair Corralation between Exchange Income and Cargojet
Assuming the 90 days trading horizon Exchange Income is expected to generate 0.61 times more return on investment than Cargojet. However, Exchange Income is 1.64 times less risky than Cargojet. It trades about 0.21 of its potential returns per unit of risk. Cargojet is currently generating about -0.09 per unit of risk. If you would invest 5,098 in Exchange Income on August 25, 2024 and sell it today you would earn a total of 525.00 from holding Exchange Income or generate 10.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exchange Income vs. Cargojet
Performance |
| Timeline |
| Exchange Income |
| Cargojet |
Exchange Income and Cargojet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exchange Income and Cargojet
The main advantage of trading using opposite Exchange Income and Cargojet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exchange Income position performs unexpectedly, Cargojet 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 Cargojet will offset losses from the drop in Cargojet's long position.| Exchange Income vs. Capital Power | Exchange Income vs. Keyera Corp | Exchange Income vs. Parkland Fuel | Exchange Income vs. TFI International |
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 Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |