Correlation Between Canso Credit and Firan Technology
Can any of the company-specific risk be diversified away by investing in both Canso Credit 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 Canso Credit and Firan Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canso Credit Trust and Firan Technology Group, you can compare the effects of market volatilities on Canso Credit 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 Canso Credit with a short position of Firan Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canso Credit and Firan Technology.
Diversification Opportunities for Canso Credit and Firan Technology
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Canso and Firan is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Canso Credit Trust and Firan Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firan Technology and Canso Credit 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 Canso Credit Trust 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 Canso Credit i.e., Canso Credit and Firan Technology go up and down completely randomly.
Pair Corralation between Canso Credit and Firan Technology
Assuming the 90 days trading horizon Canso Credit Trust is expected to under-perform the Firan Technology. But the stock apears to be less risky and, when comparing its historical volatility, Canso Credit Trust is 6.34 times less risky than Firan Technology. The stock trades about -0.01 of its potential returns per unit of risk. The Firan Technology Group is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 742.00 in Firan Technology Group on November 3, 2024 and sell it today you would earn a total of 83.00 from holding Firan Technology Group or generate 11.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Canso Credit Trust vs. Firan Technology Group
Performance |
| Timeline |
| Canso Credit Trust |
| Firan Technology |
Canso Credit and Firan Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canso Credit and Firan Technology
The main advantage of trading using opposite Canso Credit and Firan Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canso Credit 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.| Canso Credit vs. MINT Income Fund | Canso Credit vs. Canadian High Income | Canso Credit vs. Blue Ribbon Income | Canso Credit vs. Australian REIT Income |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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