Correlation Between Rogers Communications and Boat Rocker
Can any of the company-specific risk be diversified away by investing in both Rogers Communications and Boat Rocker 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 Rogers Communications and Boat Rocker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rogers Communications and Boat Rocker Media, you can compare the effects of market volatilities on Rogers Communications and Boat Rocker 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 Rogers Communications with a short position of Boat Rocker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and Boat Rocker.
Diversification Opportunities for Rogers Communications and Boat Rocker
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rogers and Boat is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and Boat Rocker Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boat Rocker Media and Rogers Communications 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 Rogers Communications are associated (or correlated) with Boat Rocker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boat Rocker Media has no effect on the direction of Rogers Communications i.e., Rogers Communications and Boat Rocker go up and down completely randomly.
Pair Corralation between Rogers Communications and Boat Rocker
Assuming the 90 days trading horizon Rogers Communications is expected to generate 0.28 times more return on investment than Boat Rocker. However, Rogers Communications is 3.62 times less risky than Boat Rocker. It trades about -0.13 of its potential returns per unit of risk. Boat Rocker Media is currently generating about -0.15 per unit of risk. If you would invest 5,797 in Rogers Communications on September 5, 2024 and sell it today you would lose (431.00) from holding Rogers Communications or give up 7.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rogers Communications vs. Boat Rocker Media
Performance |
| Timeline |
| Rogers Communications |
| Boat Rocker Media |
Rogers Communications and Boat Rocker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rogers Communications and Boat Rocker
The main advantage of trading using opposite Rogers Communications and Boat Rocker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rogers Communications position performs unexpectedly, Boat Rocker 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 Boat Rocker will offset losses from the drop in Boat Rocker's long position.| Rogers Communications vs. Computer Modelling Group | Rogers Communications vs. Perseus Mining | Rogers Communications vs. Algonquin Power Utilities | Rogers Communications vs. Verizon Communications CDR |
| Boat Rocker vs. Thunderbird Entertainment Group | Boat Rocker vs. VerticalScope Holdings | Boat Rocker vs. WildBrain | Boat Rocker vs. Kits Eyecare |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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