Correlation Between Pollard Banknote and Intact Financial
Can any of the company-specific risk be diversified away by investing in both Pollard Banknote and Intact Financial 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 Pollard Banknote and Intact Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pollard Banknote Limited and Intact Financial Corp, you can compare the effects of market volatilities on Pollard Banknote and Intact Financial 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 Pollard Banknote with a short position of Intact Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pollard Banknote and Intact Financial.
Diversification Opportunities for Pollard Banknote and Intact Financial
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pollard and Intact is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Pollard Banknote Limited and Intact Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intact Financial Corp and Pollard Banknote 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 Pollard Banknote Limited are associated (or correlated) with Intact Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intact Financial Corp has no effect on the direction of Pollard Banknote i.e., Pollard Banknote and Intact Financial go up and down completely randomly.
Pair Corralation between Pollard Banknote and Intact Financial
Assuming the 90 days trading horizon Pollard Banknote Limited is expected to generate 2.99 times more return on investment than Intact Financial. However, Pollard Banknote is 2.99 times more volatile than Intact Financial Corp. It trades about 0.04 of its potential returns per unit of risk. Intact Financial Corp is currently generating about 0.08 per unit of risk. If you would invest 1,847 in Pollard Banknote Limited on August 30, 2024 and sell it today you would earn a total of 719.00 from holding Pollard Banknote Limited or generate 38.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pollard Banknote Limited vs. Intact Financial Corp
Performance |
| Timeline |
| Pollard Banknote |
| Intact Financial Corp |
Pollard Banknote and Intact Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pollard Banknote and Intact Financial
The main advantage of trading using opposite Pollard Banknote and Intact Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pollard Banknote position performs unexpectedly, Intact Financial 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 Intact Financial will offset losses from the drop in Intact Financial's long position.| Pollard Banknote vs. Eros Resources Corp | Pollard Banknote vs. Apple Inc CDR | Pollard Banknote vs. European Residential Real | Pollard Banknote vs. Canadian Utilities Ltd |
| Intact Financial vs. Walmart Inc CDR | Intact Financial vs. Amazon CDR | Intact Financial vs. Berkshire Hathaway CDR | Intact Financial vs. UnitedHealth Group 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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