Correlation Between Intact Financial and Canagold Resources
Can any of the company-specific risk be diversified away by investing in both Intact Financial and Canagold 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 Intact Financial and Canagold Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intact Financial and Canagold Resources, you can compare the effects of market volatilities on Intact Financial and Canagold 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 Intact Financial with a short position of Canagold Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intact Financial and Canagold Resources.
Diversification Opportunities for Intact Financial and Canagold Resources
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Intact and Canagold is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Intact Financial and Canagold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canagold Resources 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 Canagold Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canagold Resources has no effect on the direction of Intact Financial i.e., Intact Financial and Canagold Resources go up and down completely randomly.
Pair Corralation between Intact Financial and Canagold Resources
Assuming the 90 days trading horizon Intact Financial is expected to generate 1.25 times less return on investment than Canagold Resources. But when comparing it to its historical volatility, Intact Financial is 3.51 times less risky than Canagold Resources. It trades about 0.1 of its potential returns per unit of risk. Canagold Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Canagold Resources on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Canagold Resources or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intact Financial vs. Canagold Resources
Performance |
| Timeline |
| Intact Financial |
| Canagold Resources |
Intact Financial and Canagold Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intact Financial and Canagold Resources
The main advantage of trading using opposite Intact Financial and Canagold Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intact Financial position performs unexpectedly, Canagold 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 Canagold Resources will offset losses from the drop in Canagold Resources' long position.| Intact Financial vs. Brompton Lifeco Split | Intact Financial vs. North American Financial | Intact Financial vs. Prime Dividend Corp | Intact Financial vs. Financial 15 Split |
| Canagold Resources vs. Starcore International Mines | Canagold Resources vs. Chesapeake Gold Corp | Canagold Resources vs. Emergent Metals Corp | Canagold Resources vs. Galantas Gold Corp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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