Correlation Between FIREWEED METALS and CDN IMPERIAL
Can any of the company-specific risk be diversified away by investing in both FIREWEED METALS and CDN IMPERIAL 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 FIREWEED METALS and CDN IMPERIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIREWEED METALS P and CDN IMPERIAL BANK, you can compare the effects of market volatilities on FIREWEED METALS and CDN IMPERIAL 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 FIREWEED METALS with a short position of CDN IMPERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIREWEED METALS and CDN IMPERIAL.
Diversification Opportunities for FIREWEED METALS and CDN IMPERIAL
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FIREWEED and CDN is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding FIREWEED METALS P and CDN IMPERIAL BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN IMPERIAL BANK and FIREWEED METALS 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 FIREWEED METALS P are associated (or correlated) with CDN IMPERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN IMPERIAL BANK has no effect on the direction of FIREWEED METALS i.e., FIREWEED METALS and CDN IMPERIAL go up and down completely randomly.
Pair Corralation between FIREWEED METALS and CDN IMPERIAL
Assuming the 90 days horizon FIREWEED METALS P is expected to generate 2.99 times more return on investment than CDN IMPERIAL. However, FIREWEED METALS is 2.99 times more volatile than CDN IMPERIAL BANK. It trades about 0.07 of its potential returns per unit of risk. CDN IMPERIAL BANK is currently generating about 0.17 per unit of risk. If you would invest 86.00 in FIREWEED METALS P on October 18, 2024 and sell it today you would earn a total of 12.00 from holding FIREWEED METALS P or generate 13.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIREWEED METALS P vs. CDN IMPERIAL BANK
Performance |
| Timeline |
| FIREWEED METALS P |
| CDN IMPERIAL BANK |
FIREWEED METALS and CDN IMPERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIREWEED METALS and CDN IMPERIAL
The main advantage of trading using opposite FIREWEED METALS and CDN IMPERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIREWEED METALS position performs unexpectedly, CDN IMPERIAL 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 CDN IMPERIAL will offset losses from the drop in CDN IMPERIAL's long position.| FIREWEED METALS vs. Ultra Clean Holdings | FIREWEED METALS vs. Ross Stores | FIREWEED METALS vs. JD SPORTS FASH | FIREWEED METALS vs. TITANIUM TRANSPORTGROUP |
| CDN IMPERIAL vs. Harmony Gold Mining | CDN IMPERIAL vs. FIREWEED METALS P | CDN IMPERIAL vs. Zijin Mining Group | CDN IMPERIAL vs. GOODYEAR T RUBBER |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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