Correlation Between Goeasy and Cargojet
Can any of the company-specific risk be diversified away by investing in both Goeasy 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 Goeasy and Cargojet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between goeasy and Cargojet, you can compare the effects of market volatilities on Goeasy 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 Goeasy with a short position of Cargojet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goeasy and Cargojet.
Diversification Opportunities for Goeasy and Cargojet
Average diversification
The 3 months correlation between Goeasy and Cargojet is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding goeasy and Cargojet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cargojet and Goeasy 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 goeasy 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 Goeasy i.e., Goeasy and Cargojet go up and down completely randomly.
Pair Corralation between Goeasy and Cargojet
Assuming the 90 days trading horizon goeasy is expected to generate 0.67 times more return on investment than Cargojet. However, goeasy is 1.48 times less risky than Cargojet. It trades about -0.05 of its potential returns per unit of risk. Cargojet is currently generating about -0.19 per unit of risk. If you would invest 17,430 in goeasy on August 26, 2024 and sell it today you would lose (278.00) from holding goeasy or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
goeasy vs. Cargojet
Performance |
| Timeline |
| goeasy |
| Cargojet |
Goeasy and Cargojet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goeasy and Cargojet
The main advantage of trading using opposite Goeasy and Cargojet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goeasy 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.| Goeasy vs. Capstone Mining Corp | Goeasy vs. Falcon Energy Materials | Goeasy vs. Metalero Mining Corp | Goeasy vs. Wishpond Technologies |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |