Correlation Between IA Financial and Wildsky Resources
Can any of the company-specific risk be diversified away by investing in both IA Financial and Wildsky Resources 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 Wildsky Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iA Financial and Wildsky Resources, you can compare the effects of market volatilities on IA Financial and Wildsky Resources 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 Wildsky Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of IA Financial and Wildsky Resources.
Diversification Opportunities for IA Financial and Wildsky Resources
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IAG and Wildsky is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding iA Financial and Wildsky Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wildsky Resources 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 Wildsky Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wildsky Resources has no effect on the direction of IA Financial i.e., IA Financial and Wildsky Resources go up and down completely randomly.
Pair Corralation between IA Financial and Wildsky Resources
Assuming the 90 days trading horizon iA Financial is expected to generate 0.23 times more return on investment than Wildsky Resources. However, iA Financial is 4.36 times less risky than Wildsky Resources. It trades about 0.08 of its potential returns per unit of risk. Wildsky Resources is currently generating about 0.0 per unit of risk. If you would invest 7,645 in iA Financial on October 12, 2024 and sell it today you would earn a total of 5,400 from holding iA Financial or generate 70.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iA Financial vs. Wildsky Resources
Performance |
| Timeline |
| iA Financial |
| Wildsky Resources |
IA Financial and Wildsky Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IA Financial and Wildsky Resources
The main advantage of trading using opposite IA Financial and Wildsky Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IA Financial position performs unexpectedly, Wildsky Resources 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 Wildsky Resources will offset losses from the drop in Wildsky Resources' long position.| IA Financial vs. Great West Lifeco | IA Financial vs. Intact Financial | IA Financial vs. IGM Financial | IA Financial vs. Sun Life Financial |
| Wildsky Resources vs. Dream Office Real | Wildsky Resources vs. Advent Wireless | Wildsky Resources vs. Leons Furniture Limited | Wildsky Resources vs. iA Financial |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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