Correlation Between Quebecor and Gildan Activewear
Can any of the company-specific risk be diversified away by investing in both Quebecor and Gildan Activewear 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 Gildan Activewear into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quebecor and Gildan Activewear, you can compare the effects of market volatilities on Quebecor and Gildan Activewear 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 Gildan Activewear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quebecor and Gildan Activewear.
Diversification Opportunities for Quebecor and Gildan Activewear
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Quebecor and Gildan is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Quebecor and Gildan Activewear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gildan Activewear 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 Gildan Activewear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gildan Activewear has no effect on the direction of Quebecor i.e., Quebecor and Gildan Activewear go up and down completely randomly.
Pair Corralation between Quebecor and Gildan Activewear
Assuming the 90 days trading horizon Quebecor is expected to under-perform the Gildan Activewear. In addition to that, Quebecor is 1.01 times more volatile than Gildan Activewear. It trades about -0.12 of its total potential returns per unit of risk. Gildan Activewear is currently generating about 0.32 per unit of volatility. If you would invest 6,719 in Gildan Activewear on October 21, 2024 and sell it today you would earn a total of 481.00 from holding Gildan Activewear or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quebecor vs. Gildan Activewear
Performance |
| Timeline |
| Quebecor |
| Gildan Activewear |
Quebecor and Gildan Activewear Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quebecor and Gildan Activewear
The main advantage of trading using opposite Quebecor and Gildan Activewear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quebecor position performs unexpectedly, Gildan Activewear 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 Gildan Activewear will offset losses from the drop in Gildan Activewear's long position.| Quebecor vs. Cogeco Communications | Quebecor vs. Transcontinental | Quebecor vs. iA Financial | Quebecor vs. Saputo Inc |
| Gildan Activewear vs. Saputo Inc | Gildan Activewear vs. CCL Industries | Gildan Activewear vs. Thomson Reuters Corp | Gildan Activewear vs. George Weston Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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