Correlation Between PATTIES FOODS and Canadian Natural
Can any of the company-specific risk be diversified away by investing in both PATTIES FOODS and Canadian Natural 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 PATTIES FOODS and Canadian Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PATTIES FOODS and Canadian Natural Resources, you can compare the effects of market volatilities on PATTIES FOODS and Canadian Natural 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 PATTIES FOODS with a short position of Canadian Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of PATTIES FOODS and Canadian Natural.
Diversification Opportunities for PATTIES FOODS and Canadian Natural
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PATTIES and Canadian is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding PATTIES FOODS and Canadian Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Natural Res and PATTIES FOODS 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 PATTIES FOODS are associated (or correlated) with Canadian Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Natural Res has no effect on the direction of PATTIES FOODS i.e., PATTIES FOODS and Canadian Natural go up and down completely randomly.
Pair Corralation between PATTIES FOODS and Canadian Natural
Assuming the 90 days horizon PATTIES FOODS is expected to under-perform the Canadian Natural. In addition to that, PATTIES FOODS is 1.73 times more volatile than Canadian Natural Resources. It trades about -0.07 of its total potential returns per unit of risk. Canadian Natural Resources is currently generating about -0.03 per unit of volatility. If you would invest 3,030 in Canadian Natural Resources on November 3, 2024 and sell it today you would lose (59.00) from holding Canadian Natural Resources or give up 1.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PATTIES FOODS vs. Canadian Natural Resources
Performance |
| Timeline |
| PATTIES FOODS |
| Canadian Natural Res |
PATTIES FOODS and Canadian Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PATTIES FOODS and Canadian Natural
The main advantage of trading using opposite PATTIES FOODS and Canadian Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PATTIES FOODS position performs unexpectedly, Canadian Natural 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 Canadian Natural will offset losses from the drop in Canadian Natural's long position.| PATTIES FOODS vs. T MOBILE US | PATTIES FOODS vs. BROADSTNET LEADL 00025 | PATTIES FOODS vs. Mobilezone Holding AG | PATTIES FOODS vs. TITANIUM TRANSPORTGROUP |
| Canadian Natural vs. Sixt Leasing SE | Canadian Natural vs. PT Steel Pipe | Canadian Natural vs. UNITED RENTALS | Canadian Natural vs. FUYO GENERAL LEASE |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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