Correlation Between Rubicon Organics and CCL Industries
Can any of the company-specific risk be diversified away by investing in both Rubicon Organics and CCL Industries 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 Rubicon Organics and CCL Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rubicon Organics and CCL Industries, you can compare the effects of market volatilities on Rubicon Organics and CCL Industries 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 Rubicon Organics with a short position of CCL Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rubicon Organics and CCL Industries.
Diversification Opportunities for Rubicon Organics and CCL Industries
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rubicon and CCL is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Rubicon Organics and CCL Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCL Industries and Rubicon Organics 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 Rubicon Organics are associated (or correlated) with CCL Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCL Industries has no effect on the direction of Rubicon Organics i.e., Rubicon Organics and CCL Industries go up and down completely randomly.
Pair Corralation between Rubicon Organics and CCL Industries
Assuming the 90 days trading horizon Rubicon Organics is expected to generate 1.81 times less return on investment than CCL Industries. In addition to that, Rubicon Organics is 4.46 times more volatile than CCL Industries. It trades about 0.01 of its total potential returns per unit of risk. CCL Industries is currently generating about 0.04 per unit of volatility. If you would invest 6,035 in CCL Industries on August 23, 2024 and sell it today you would earn a total of 1,707 from holding CCL Industries or generate 28.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rubicon Organics vs. CCL Industries
Performance |
| Timeline |
| Rubicon Organics |
| CCL Industries |
Rubicon Organics and CCL Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rubicon Organics and CCL Industries
The main advantage of trading using opposite Rubicon Organics and CCL Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rubicon Organics position performs unexpectedly, CCL Industries 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 CCL Industries will offset losses from the drop in CCL Industries' long position.| Rubicon Organics vs. Forstrong Global Income | Rubicon Organics vs. BMO Aggregate Bond | Rubicon Organics vs. iShares Canadian HYBrid | Rubicon Organics vs. Brompton European Dividend |
| CCL Industries vs. Fairfax Financial Holdings | CCL Industries vs. US Financial 15 | CCL Industries vs. Aurora Solar Technologies | CCL Industries vs. Solar Alliance Energy |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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