Correlation Between Virgin Group and Canlan Ice
Can any of the company-specific risk be diversified away by investing in both Virgin Group and Canlan Ice 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 Virgin Group and Canlan Ice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virgin Group Acquisition and Canlan Ice Sports, you can compare the effects of market volatilities on Virgin Group and Canlan Ice 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 Virgin Group with a short position of Canlan Ice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virgin Group and Canlan Ice.
Diversification Opportunities for Virgin Group and Canlan Ice
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Virgin and Canlan is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Virgin Group Acquisition and Canlan Ice Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canlan Ice Sports and Virgin Group 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 Virgin Group Acquisition are associated (or correlated) with Canlan Ice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canlan Ice Sports has no effect on the direction of Virgin Group i.e., Virgin Group and Canlan Ice go up and down completely randomly.
Pair Corralation between Virgin Group and Canlan Ice
Given the investment horizon of 90 days Virgin Group Acquisition is expected to under-perform the Canlan Ice. In addition to that, Virgin Group is 33.64 times more volatile than Canlan Ice Sports. It trades about -0.04 of its total potential returns per unit of risk. Canlan Ice Sports is currently generating about 0.14 per unit of volatility. If you would invest 278.00 in Canlan Ice Sports on October 16, 2024 and sell it today you would earn a total of 19.00 from holding Canlan Ice Sports or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Virgin Group Acquisition vs. Canlan Ice Sports
Performance |
| Timeline |
| Virgin Group Acquisition |
| Canlan Ice Sports |
Virgin Group and Canlan Ice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virgin Group and Canlan Ice
The main advantage of trading using opposite Virgin Group and Canlan Ice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virgin Group position performs unexpectedly, Canlan Ice 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 Canlan Ice will offset losses from the drop in Canlan Ice's long position.| Virgin Group vs. Mannatech Incorporated | Virgin Group vs. Edgewell Personal Care | Virgin Group vs. Inter Parfums | Virgin Group vs. Nu Skin Enterprises |
| Canlan Ice vs. Academy Sports Outdoors | Canlan Ice vs. Weyco Group | Canlan Ice vs. Virgin Group Acquisition | Canlan Ice vs. RH |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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