Correlation Between Imax Corp and Compass Diversified
Can any of the company-specific risk be diversified away by investing in both Imax Corp and Compass Diversified 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 Imax Corp and Compass Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imax Corp and Compass Diversified Holdings, you can compare the effects of market volatilities on Imax Corp and Compass Diversified 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 Imax Corp with a short position of Compass Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imax Corp and Compass Diversified.
Diversification Opportunities for Imax Corp and Compass Diversified
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Imax and Compass is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Imax Corp and Compass Diversified Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compass Diversified and Imax Corp 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 Imax Corp are associated (or correlated) with Compass Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compass Diversified has no effect on the direction of Imax Corp i.e., Imax Corp and Compass Diversified go up and down completely randomly.
Pair Corralation between Imax Corp and Compass Diversified
Given the investment horizon of 90 days Imax Corp is expected to generate 1.21 times more return on investment than Compass Diversified. However, Imax Corp is 1.21 times more volatile than Compass Diversified Holdings. It trades about -0.07 of its potential returns per unit of risk. Compass Diversified Holdings is currently generating about -0.16 per unit of risk. If you would invest 2,402 in Imax Corp on November 7, 2024 and sell it today you would lose (47.00) from holding Imax Corp or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imax Corp vs. Compass Diversified Holdings
Performance |
| Timeline |
| Imax Corp |
| Compass Diversified |
Imax Corp and Compass Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imax Corp and Compass Diversified
The main advantage of trading using opposite Imax Corp and Compass Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imax Corp position performs unexpectedly, Compass Diversified 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 Compass Diversified will offset losses from the drop in Compass Diversified's long position.| Imax Corp vs. Marcus | Imax Corp vs. Dave Busters Entertainment | Imax Corp vs. AMC Networks | Imax Corp vs. News Corp A |
| Compass Diversified vs. Western Copper and | Compass Diversified vs. Harmony Gold Mining | Compass Diversified vs. Cementos Pacasmayo SAA | Compass Diversified vs. CleanGo Innovations |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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