Correlation Between IPG Photonics and Canlan Ice
Can any of the company-specific risk be diversified away by investing in both IPG Photonics and Canlan Ice 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 IPG Photonics and Canlan Ice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IPG Photonics and Canlan Ice Sports, you can compare the effects of market volatilities on IPG Photonics and Canlan Ice 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 IPG Photonics with a short position of Canlan Ice. Check out your portfolio center. Please also check ongoing floating volatility patterns of IPG Photonics and Canlan Ice.
Diversification Opportunities for IPG Photonics and Canlan Ice
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IPG and Canlan is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding IPG Photonics and Canlan Ice Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canlan Ice Sports and IPG Photonics 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 IPG Photonics are associated (or correlated) with Canlan Ice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canlan Ice Sports has no effect on the direction of IPG Photonics i.e., IPG Photonics and Canlan Ice go up and down completely randomly.
Pair Corralation between IPG Photonics and Canlan Ice
If you would invest 297.00 in Canlan Ice Sports on November 5, 2024 and sell it today you would earn a total of 0.00 from holding Canlan Ice Sports or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IPG Photonics vs. Canlan Ice Sports
Performance |
| Timeline |
| IPG Photonics |
| Canlan Ice Sports |
IPG Photonics and Canlan Ice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IPG Photonics and Canlan Ice
The main advantage of trading using opposite IPG Photonics and Canlan Ice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IPG Photonics position performs unexpectedly, Canlan Ice 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 Canlan Ice will offset losses from the drop in Canlan Ice's long position.| IPG Photonics vs. Teradyne | IPG Photonics vs. Ultra Clean Holdings | IPG Photonics vs. Onto Innovation | IPG Photonics vs. Cohu Inc |
| Canlan Ice vs. SmartStop Self Storage | Canlan Ice vs. Bm Technologies | Canlan Ice vs. Cadence Design Systems | Canlan Ice vs. Centessa Pharmaceuticals PLC |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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