Correlation Between Quebecor and Finning International
Can any of the company-specific risk be diversified away by investing in both Quebecor and Finning International 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 Quebecor and Finning International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quebecor and Finning International, you can compare the effects of market volatilities on Quebecor and Finning International 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 Quebecor with a short position of Finning International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quebecor and Finning International.
Diversification Opportunities for Quebecor and Finning International
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Quebecor and Finning is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Quebecor and Finning International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finning International and Quebecor 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 Quebecor are associated (or correlated) with Finning International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finning International has no effect on the direction of Quebecor i.e., Quebecor and Finning International go up and down completely randomly.
Pair Corralation between Quebecor and Finning International
Assuming the 90 days trading horizon Quebecor is expected to generate 0.58 times more return on investment than Finning International. However, Quebecor is 1.73 times less risky than Finning International. It trades about -0.28 of its potential returns per unit of risk. Finning International is currently generating about -0.16 per unit of risk. If you would invest 3,521 in Quebecor on August 28, 2024 and sell it today you would lose (287.00) from holding Quebecor or give up 8.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quebecor vs. Finning International
Performance |
| Timeline |
| Quebecor |
| Finning International |
Quebecor and Finning International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quebecor and Finning International
The main advantage of trading using opposite Quebecor and Finning International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quebecor position performs unexpectedly, Finning International 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 Finning International will offset losses from the drop in Finning International's long position.| Quebecor vs. Cogeco Communications | Quebecor vs. Transcontinental | Quebecor vs. iA Financial | Quebecor vs. Saputo Inc |
| Finning International vs. ATS P | Finning International vs. Richelieu Hardware | Finning International vs. West Fraser Timber | Finning International vs. Brookfield |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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