Correlation Between KDA and Rogers Communications
Can any of the company-specific risk be diversified away by investing in both KDA and Rogers Communications 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 KDA and Rogers Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KDA Group and Rogers Communications, you can compare the effects of market volatilities on KDA and Rogers Communications 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 KDA with a short position of Rogers Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of KDA and Rogers Communications.
Diversification Opportunities for KDA and Rogers Communications
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KDA and Rogers is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding KDA Group and Rogers Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers Communications and KDA 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 KDA Group are associated (or correlated) with Rogers Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers Communications has no effect on the direction of KDA i.e., KDA and Rogers Communications go up and down completely randomly.
Pair Corralation between KDA and Rogers Communications
Assuming the 90 days horizon KDA Group is expected to generate 4.55 times more return on investment than Rogers Communications. However, KDA is 4.55 times more volatile than Rogers Communications. It trades about -0.01 of its potential returns per unit of risk. Rogers Communications is currently generating about -0.07 per unit of risk. If you would invest 30.00 in KDA Group on September 3, 2024 and sell it today you would lose (3.00) from holding KDA Group or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KDA Group vs. Rogers Communications
Performance |
| Timeline |
| KDA Group |
| Rogers Communications |
KDA and Rogers Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KDA and Rogers Communications
The main advantage of trading using opposite KDA and Rogers Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KDA position performs unexpectedly, Rogers Communications 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 Rogers Communications will offset losses from the drop in Rogers Communications' long position.| KDA vs. Air Canada | KDA vs. Algoma Steel Group | KDA vs. Maple Leaf Foods | KDA vs. Brookfield Office Properties |
| Rogers Communications vs. Maple Peak Investments | Rogers Communications vs. Western Investment | Rogers Communications vs. TUT Fitness Group | Rogers Communications vs. Economic Investment Trust |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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