Correlation Between Intact Financial and Bell Copper
Can any of the company-specific risk be diversified away by investing in both Intact Financial and Bell Copper 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 Intact Financial and Bell Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intact Financial and Bell Copper Corp, you can compare the effects of market volatilities on Intact Financial and Bell Copper 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 Intact Financial with a short position of Bell Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intact Financial and Bell Copper.
Diversification Opportunities for Intact Financial and Bell Copper
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intact and Bell is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Intact Financial and Bell Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bell Copper Corp and Intact 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 Intact Financial are associated (or correlated) with Bell Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bell Copper Corp has no effect on the direction of Intact Financial i.e., Intact Financial and Bell Copper go up and down completely randomly.
Pair Corralation between Intact Financial and Bell Copper
Assuming the 90 days trading horizon Intact Financial is expected to generate 0.09 times more return on investment than Bell Copper. However, Intact Financial is 11.01 times less risky than Bell Copper. It trades about -0.09 of its potential returns per unit of risk. Bell Copper Corp is currently generating about -0.09 per unit of risk. If you would invest 26,861 in Intact Financial on September 15, 2024 and sell it today you would lose (531.00) from holding Intact Financial or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Intact Financial vs. Bell Copper Corp
Performance |
| Timeline |
| Intact Financial |
| Bell Copper Corp |
Intact Financial and Bell Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intact Financial and Bell Copper
The main advantage of trading using opposite Intact Financial and Bell Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intact Financial position performs unexpectedly, Bell Copper 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 Bell Copper will offset losses from the drop in Bell Copper's long position.| Intact Financial vs. Topaz Energy Corp | Intact Financial vs. iShares Canadian HYBrid | Intact Financial vs. Altagas Cum Red | Intact Financial vs. RBC Discount Bond |
| Bell Copper vs. Pacific Ridge Exploration | Bell Copper vs. BCM Resources Corp | Bell Copper vs. Dore Copper Mining | Bell Copper vs. Goliath Resources |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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