Correlation Between Profound Medical and CNJ Capital
Can any of the company-specific risk be diversified away by investing in both Profound Medical and CNJ Capital 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 Profound Medical and CNJ Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Profound Medical Corp and CNJ Capital Investments, you can compare the effects of market volatilities on Profound Medical and CNJ Capital 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 Profound Medical with a short position of CNJ Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Profound Medical and CNJ Capital.
Diversification Opportunities for Profound Medical and CNJ Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Profound and CNJ is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Profound Medical Corp and CNJ Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNJ Capital Investments and Profound Medical 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 Profound Medical Corp are associated (or correlated) with CNJ Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNJ Capital Investments has no effect on the direction of Profound Medical i.e., Profound Medical and CNJ Capital go up and down completely randomly.
Pair Corralation between Profound Medical and CNJ Capital
Assuming the 90 days trading horizon Profound Medical Corp is expected to generate 1.98 times more return on investment than CNJ Capital. However, Profound Medical is 1.98 times more volatile than CNJ Capital Investments. It trades about 0.0 of its potential returns per unit of risk. CNJ Capital Investments is currently generating about -0.02 per unit of risk. If you would invest 998.00 in Profound Medical Corp on November 1, 2024 and sell it today you would lose (99.00) from holding Profound Medical Corp or give up 9.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Profound Medical Corp vs. CNJ Capital Investments
Performance |
| Timeline |
| Profound Medical Corp |
| CNJ Capital Investments |
Profound Medical and CNJ Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Profound Medical and CNJ Capital
The main advantage of trading using opposite Profound Medical and CNJ Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Profound Medical position performs unexpectedly, CNJ Capital 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 CNJ Capital will offset losses from the drop in CNJ Capital's long position.| Profound Medical vs. HLS Therapeutics | Profound Medical vs. Medicenna Therapeutics Corp | Profound Medical vs. Aptose Biosciences |
| CNJ Capital vs. Datable Technology Corp | CNJ Capital vs. Titanium Transportation Group | CNJ Capital vs. Canadian Utilities Limited | CNJ Capital vs. Advent Wireless |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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