Correlation Between Primaris Retail and Postmedia Network
Can any of the company-specific risk be diversified away by investing in both Primaris Retail and Postmedia Network 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 Primaris Retail and Postmedia Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Primaris Retail RE and Postmedia Network Canada, you can compare the effects of market volatilities on Primaris Retail and Postmedia Network 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 Primaris Retail with a short position of Postmedia Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Primaris Retail and Postmedia Network.
Diversification Opportunities for Primaris Retail and Postmedia Network
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Primaris and Postmedia is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Primaris Retail RE and Postmedia Network Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postmedia Network Canada and Primaris Retail 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 Primaris Retail RE are associated (or correlated) with Postmedia Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postmedia Network Canada has no effect on the direction of Primaris Retail i.e., Primaris Retail and Postmedia Network go up and down completely randomly.
Pair Corralation between Primaris Retail and Postmedia Network
Assuming the 90 days trading horizon Primaris Retail RE is expected to generate 0.28 times more return on investment than Postmedia Network. However, Primaris Retail RE is 3.54 times less risky than Postmedia Network. It trades about 0.06 of its potential returns per unit of risk. Postmedia Network Canada is currently generating about 0.01 per unit of risk. If you would invest 1,188 in Primaris Retail RE on August 26, 2024 and sell it today you would earn a total of 401.00 from holding Primaris Retail RE or generate 33.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Primaris Retail RE vs. Postmedia Network Canada
Performance |
| Timeline |
| Primaris Retail RE |
| Postmedia Network Canada |
Primaris Retail and Postmedia Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Primaris Retail and Postmedia Network
The main advantage of trading using opposite Primaris Retail and Postmedia Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Primaris Retail position performs unexpectedly, Postmedia Network 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 Postmedia Network will offset losses from the drop in Postmedia Network's long position.| Primaris Retail vs. HR Real Estate | Primaris Retail vs. Dream Office Real | Primaris Retail vs. Artis Real Estate | Primaris Retail vs. Boardwalk Real Estate |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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