Correlation Between Rogers Communications and National Bank
Can any of the company-specific risk be diversified away by investing in both Rogers Communications and National Bank 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 National Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rogers Communications and National Bank of, you can compare the effects of market volatilities on Rogers Communications and National Bank 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 National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and National Bank.
Diversification Opportunities for Rogers Communications and National Bank
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rogers and National is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and National Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank 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 National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank has no effect on the direction of Rogers Communications i.e., Rogers Communications and National Bank go up and down completely randomly.
Pair Corralation between Rogers Communications and National Bank
Assuming the 90 days trading horizon Rogers Communications is expected to under-perform the National Bank. In addition to that, Rogers Communications is 3.14 times more volatile than National Bank of. It trades about 0.0 of its total potential returns per unit of risk. National Bank of is currently generating about 0.12 per unit of volatility. If you would invest 2,264 in National Bank of on August 25, 2024 and sell it today you would earn a total of 330.00 from holding National Bank of or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rogers Communications vs. National Bank of
Performance |
| Timeline |
| Rogers Communications |
| National Bank |
Rogers Communications and National Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rogers Communications and National Bank
The main advantage of trading using opposite Rogers Communications and National Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rogers Communications position performs unexpectedly, National Bank 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 National Bank will offset losses from the drop in National Bank's long position.| Rogers Communications vs. Boat Rocker Media | Rogers Communications vs. Maple Leaf Foods | Rogers Communications vs. Computer Modelling Group | Rogers Communications vs. Hemisphere Energy |
| National Bank vs. Partners Value Investments | National Bank vs. CNJ Capital Investments | National Bank vs. Medical Facilities | National Bank vs. Rogers Communications |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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