Correlation Between FG Acquisition and Canadian Utilities
Can any of the company-specific risk be diversified away by investing in both FG Acquisition and Canadian Utilities 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 FG Acquisition and Canadian Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FG Acquisition Corp and Canadian Utilities Ltd, you can compare the effects of market volatilities on FG Acquisition and Canadian Utilities 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 FG Acquisition with a short position of Canadian Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of FG Acquisition and Canadian Utilities.
Diversification Opportunities for FG Acquisition and Canadian Utilities
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FGAA-U and Canadian is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding FG Acquisition Corp and Canadian Utilities Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities and FG Acquisition 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 FG Acquisition Corp are associated (or correlated) with Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of FG Acquisition i.e., FG Acquisition and Canadian Utilities go up and down completely randomly.
Pair Corralation between FG Acquisition and Canadian Utilities
If you would invest 2,200 in Canadian Utilities Ltd on September 13, 2024 and sell it today you would earn a total of 31.00 from holding Canadian Utilities Ltd or generate 1.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 59.09% |
| Values | Daily Returns |
FG Acquisition Corp vs. Canadian Utilities Ltd
Performance |
| Timeline |
| FG Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Canadian Utilities |
FG Acquisition and Canadian Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FG Acquisition and Canadian Utilities
The main advantage of trading using opposite FG Acquisition and Canadian Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FG Acquisition position performs unexpectedly, Canadian Utilities 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 Canadian Utilities will offset losses from the drop in Canadian Utilities' long position.| FG Acquisition vs. Electra Battery Materials | FG Acquisition vs. A W FOOD | FG Acquisition vs. Canso Credit Trust | FG Acquisition vs. NextSource Materials |
| Canadian Utilities vs. CVW CleanTech | Canadian Utilities vs. Canaf Investments | Canadian Utilities vs. Westshore Terminals Investment | Canadian Utilities vs. Partners Value Investments |
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 Stocks Directory module to find actively traded stocks across global markets.
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