Correlation Between CI Canada and Ninepoint Energy
Can any of the company-specific risk be diversified away by investing in both CI Canada and Ninepoint Energy 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 CI Canada and Ninepoint Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Canada Lifeco and Ninepoint Energy, you can compare the effects of market volatilities on CI Canada and Ninepoint Energy 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 CI Canada with a short position of Ninepoint Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Canada and Ninepoint Energy.
Diversification Opportunities for CI Canada and Ninepoint Energy
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FLI and Ninepoint is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding CI Canada Lifeco and Ninepoint Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ninepoint Energy and CI Canada 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 CI Canada Lifeco are associated (or correlated) with Ninepoint Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ninepoint Energy has no effect on the direction of CI Canada i.e., CI Canada and Ninepoint Energy go up and down completely randomly.
Pair Corralation between CI Canada and Ninepoint Energy
Assuming the 90 days trading horizon CI Canada Lifeco is expected to generate 0.62 times more return on investment than Ninepoint Energy. However, CI Canada Lifeco is 1.61 times less risky than Ninepoint Energy. It trades about 0.06 of its potential returns per unit of risk. Ninepoint Energy is currently generating about 0.02 per unit of risk. If you would invest 886.00 in CI Canada Lifeco on September 3, 2024 and sell it today you would earn a total of 313.00 from holding CI Canada Lifeco or generate 35.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Canada Lifeco vs. Ninepoint Energy
Performance |
| Timeline |
| CI Canada Lifeco |
| Ninepoint Energy |
CI Canada and Ninepoint Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Canada and Ninepoint Energy
The main advantage of trading using opposite CI Canada and Ninepoint Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Canada position performs unexpectedly, Ninepoint Energy 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 Ninepoint Energy will offset losses from the drop in Ninepoint Energy's long position.| CI Canada vs. First Asset Energy | CI Canada vs. CI Gold Giants | CI Canada vs. Harvest Equal Weight | CI Canada vs. First Asset Tech |
| Ninepoint Energy vs. First Asset Energy | Ninepoint Energy vs. First Asset Tech | Ninepoint Energy vs. Harvest Equal Weight | Ninepoint Energy vs. CI Canada Lifeco |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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