Correlation Between IA Financial and Capstone Mining
Can any of the company-specific risk be diversified away by investing in both IA Financial and Capstone Mining 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 IA Financial and Capstone Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iA Financial and Capstone Mining Corp, you can compare the effects of market volatilities on IA Financial and Capstone Mining 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 IA Financial with a short position of Capstone Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of IA Financial and Capstone Mining.
Diversification Opportunities for IA Financial and Capstone Mining
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between IAG and Capstone is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding iA Financial and Capstone Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capstone Mining Corp and IA Financial 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 iA Financial are associated (or correlated) with Capstone Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capstone Mining Corp has no effect on the direction of IA Financial i.e., IA Financial and Capstone Mining go up and down completely randomly.
Pair Corralation between IA Financial and Capstone Mining
Assuming the 90 days trading horizon iA Financial is expected to generate 0.58 times more return on investment than Capstone Mining. However, iA Financial is 1.71 times less risky than Capstone Mining. It trades about 0.2 of its potential returns per unit of risk. Capstone Mining Corp is currently generating about 0.04 per unit of risk. If you would invest 8,757 in iA Financial on September 2, 2024 and sell it today you would earn a total of 4,626 from holding iA Financial or generate 52.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iA Financial vs. Capstone Mining Corp
Performance |
| Timeline |
| iA Financial |
| Capstone Mining Corp |
IA Financial and Capstone Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IA Financial and Capstone Mining
The main advantage of trading using opposite IA Financial and Capstone Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IA Financial position performs unexpectedly, Capstone Mining 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 Capstone Mining will offset losses from the drop in Capstone Mining's long position.| IA Financial vs. Great West Lifeco | IA Financial vs. Intact Financial | IA Financial vs. IGM Financial | IA Financial vs. Sun Life Financial |
| Capstone Mining vs. Computer Modelling Group | Capstone Mining vs. CVW CleanTech | Capstone Mining vs. Xtract One Technologies | Capstone Mining vs. Quisitive Technology Solutions |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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