Correlation Between Maple Leaf and Firan Technology
Can any of the company-specific risk be diversified away by investing in both Maple Leaf and Firan Technology 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 Maple Leaf and Firan Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maple Leaf Foods and Firan Technology Group, you can compare the effects of market volatilities on Maple Leaf and Firan Technology 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 Maple Leaf with a short position of Firan Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maple Leaf and Firan Technology.
Diversification Opportunities for Maple Leaf and Firan Technology
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maple and Firan is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Maple Leaf Foods and Firan Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firan Technology and Maple Leaf 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 Maple Leaf Foods are associated (or correlated) with Firan Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firan Technology has no effect on the direction of Maple Leaf i.e., Maple Leaf and Firan Technology go up and down completely randomly.
Pair Corralation between Maple Leaf and Firan Technology
Assuming the 90 days trading horizon Maple Leaf Foods is expected to generate 1.0 times more return on investment than Firan Technology. However, Maple Leaf Foods is 1.0 times less risky than Firan Technology. It trades about 0.21 of its potential returns per unit of risk. Firan Technology Group is currently generating about 0.19 per unit of risk. If you would invest 2,146 in Maple Leaf Foods on August 27, 2024 and sell it today you would earn a total of 188.00 from holding Maple Leaf Foods or generate 8.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maple Leaf Foods vs. Firan Technology Group
Performance |
| Timeline |
| Maple Leaf Foods |
| Firan Technology |
Maple Leaf and Firan Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maple Leaf and Firan Technology
The main advantage of trading using opposite Maple Leaf and Firan Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maple Leaf position performs unexpectedly, Firan Technology 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 Firan Technology will offset losses from the drop in Firan Technology's long position.| Maple Leaf vs. Saputo Inc | Maple Leaf vs. George Weston Limited | Maple Leaf vs. Empire Company Limited | Maple Leaf vs. Premium Brands Holdings |
| Firan Technology vs. Hammond Power Solutions | Firan Technology vs. Questor Technology | Firan Technology vs. Vecima Networks | Firan Technology vs. Heroux Devtek |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |