Correlation Between National Bank and Maritime Launch
Can any of the company-specific risk be diversified away by investing in both National Bank and Maritime Launch 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 National Bank and Maritime Launch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and Maritime Launch Services, you can compare the effects of market volatilities on National Bank and Maritime Launch 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 National Bank with a short position of Maritime Launch. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Maritime Launch.
Diversification Opportunities for National Bank and Maritime Launch
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between National and Maritime is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Maritime Launch Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maritime Launch Services and National Bank 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 National Bank of are associated (or correlated) with Maritime Launch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maritime Launch Services has no effect on the direction of National Bank i.e., National Bank and Maritime Launch go up and down completely randomly.
Pair Corralation between National Bank and Maritime Launch
Assuming the 90 days horizon National Bank of is expected to generate 0.11 times more return on investment than Maritime Launch. However, National Bank of is 8.79 times less risky than Maritime Launch. It trades about 0.2 of its potential returns per unit of risk. Maritime Launch Services is currently generating about 0.0 per unit of risk. If you would invest 9,054 in National Bank of on September 4, 2024 and sell it today you would earn a total of 5,022 from holding National Bank of or generate 55.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
National Bank of vs. Maritime Launch Services
Performance |
| Timeline |
| National Bank |
| Maritime Launch Services |
National Bank and Maritime Launch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Maritime Launch
The main advantage of trading using opposite National Bank and Maritime Launch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Maritime Launch 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 Maritime Launch will offset losses from the drop in Maritime Launch's long position.| National Bank vs. Canadian Imperial Bank | National Bank vs. Bank of Montreal | National Bank vs. Royal Bank of | National Bank vs. Bank of Nova |
| Maritime Launch vs. Alphabet Inc CDR | Maritime Launch vs. Microsoft Corp CDR | Maritime Launch vs. NVIDIA CDR | Maritime Launch vs. Tesla Inc CDR |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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