Correlation Between Rogers Communications and Leons Furniture
Can any of the company-specific risk be diversified away by investing in both Rogers Communications and Leons Furniture 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 Leons Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rogers Communications and Leons Furniture Limited, you can compare the effects of market volatilities on Rogers Communications and Leons Furniture 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 Leons Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and Leons Furniture.
Diversification Opportunities for Rogers Communications and Leons Furniture
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rogers and Leons is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and Leons Furniture Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leons Furniture 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 Leons Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leons Furniture has no effect on the direction of Rogers Communications i.e., Rogers Communications and Leons Furniture go up and down completely randomly.
Pair Corralation between Rogers Communications and Leons Furniture
Assuming the 90 days trading horizon Rogers Communications is expected to under-perform the Leons Furniture. In addition to that, Rogers Communications is 1.22 times more volatile than Leons Furniture Limited. It trades about -0.04 of its total potential returns per unit of risk. Leons Furniture Limited is currently generating about 0.07 per unit of volatility. If you would invest 2,666 in Leons Furniture Limited on September 3, 2024 and sell it today you would earn a total of 46.00 from holding Leons Furniture Limited or generate 1.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rogers Communications vs. Leons Furniture Limited
Performance |
| Timeline |
| Rogers Communications |
| Leons Furniture |
Rogers Communications and Leons Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rogers Communications and Leons Furniture
The main advantage of trading using opposite Rogers Communications and Leons Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rogers Communications position performs unexpectedly, Leons Furniture 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 Leons Furniture will offset losses from the drop in Leons Furniture's long position.| Rogers Communications vs. Maple Peak Investments | Rogers Communications vs. Western Investment | Rogers Communications vs. TUT Fitness Group | Rogers Communications vs. Economic Investment Trust |
| Leons Furniture vs. High Liner Foods | Leons Furniture vs. Richelieu Hardware | Leons Furniture vs. International Zeolite Corp | Leons Furniture vs. European Residential Real |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |