Correlation Between Income Financial and Primaris Retail
Can any of the company-specific risk be diversified away by investing in both Income Financial and Primaris Retail 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 Income Financial and Primaris Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Income Financial Trust and Primaris Retail RE, you can compare the effects of market volatilities on Income Financial and Primaris Retail 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 Income Financial with a short position of Primaris Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Income Financial and Primaris Retail.
Diversification Opportunities for Income Financial and Primaris Retail
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Income and Primaris is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Income Financial Trust and Primaris Retail RE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primaris Retail RE and Income 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 Income Financial Trust are associated (or correlated) with Primaris Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primaris Retail RE has no effect on the direction of Income Financial i.e., Income Financial and Primaris Retail go up and down completely randomly.
Pair Corralation between Income Financial and Primaris Retail
Assuming the 90 days trading horizon Income Financial Trust is expected to generate 1.59 times more return on investment than Primaris Retail. However, Income Financial is 1.59 times more volatile than Primaris Retail RE. It trades about 0.08 of its potential returns per unit of risk. Primaris Retail RE is currently generating about 0.08 per unit of risk. If you would invest 634.00 in Income Financial Trust on August 31, 2024 and sell it today you would earn a total of 265.00 from holding Income Financial Trust or generate 41.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Income Financial Trust vs. Primaris Retail RE
Performance |
| Timeline |
| Income Financial Trust |
| Primaris Retail RE |
Income Financial and Primaris Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Income Financial and Primaris Retail
The main advantage of trading using opposite Income Financial and Primaris Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Income Financial position performs unexpectedly, Primaris Retail 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 Primaris Retail will offset losses from the drop in Primaris Retail's long position.| Income Financial vs. iShares Canadian HYBrid | Income Financial vs. Brompton European Dividend | Income Financial vs. Solar Alliance Energy | Income Financial vs. PHN Multi Style All Cap |
| Primaris Retail vs. Sprott Physical Gold | Primaris Retail vs. Canso Select Opportunities | Primaris Retail vs. Green Panda Capital | Primaris Retail vs. Manulife Finl Srs |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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