Correlation Between Postmedia Network and Slate Grocery
Can any of the company-specific risk be diversified away by investing in both Postmedia Network and Slate Grocery 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 Postmedia Network and Slate Grocery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postmedia Network Canada and Slate Grocery REIT, you can compare the effects of market volatilities on Postmedia Network and Slate Grocery 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 Postmedia Network with a short position of Slate Grocery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postmedia Network and Slate Grocery.
Diversification Opportunities for Postmedia Network and Slate Grocery
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Postmedia and Slate is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Postmedia Network Canada and Slate Grocery REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Grocery REIT and Postmedia Network 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 Postmedia Network Canada are associated (or correlated) with Slate Grocery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Grocery REIT has no effect on the direction of Postmedia Network i.e., Postmedia Network and Slate Grocery go up and down completely randomly.
Pair Corralation between Postmedia Network and Slate Grocery
Assuming the 90 days trading horizon Postmedia Network Canada is expected to generate 3.32 times more return on investment than Slate Grocery. However, Postmedia Network is 3.32 times more volatile than Slate Grocery REIT. It trades about 0.02 of its potential returns per unit of risk. Slate Grocery REIT is currently generating about 0.02 per unit of risk. If you would invest 142.00 in Postmedia Network Canada on September 3, 2024 and sell it today you would lose (17.00) from holding Postmedia Network Canada or give up 11.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postmedia Network Canada vs. Slate Grocery REIT
Performance |
| Timeline |
| Postmedia Network Canada |
| Slate Grocery REIT |
Postmedia Network and Slate Grocery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postmedia Network and Slate Grocery
The main advantage of trading using opposite Postmedia Network and Slate Grocery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postmedia Network position performs unexpectedly, Slate Grocery 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 Slate Grocery will offset losses from the drop in Slate Grocery's long position.| Postmedia Network vs. SalesforceCom CDR | Postmedia Network vs. TGS Esports | Postmedia Network vs. Marimaca Copper Corp | Postmedia Network vs. SPoT Coffee |
| Slate Grocery vs. Dream Office Real | Slate Grocery vs. Profound Medical Corp | Slate Grocery vs. Brookfield Office Properties | Slate Grocery vs. Economic Investment Trust |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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