Correlation Between Simply Better and Cogeco Communications
Can any of the company-specific risk be diversified away by investing in both Simply Better and Cogeco Communications 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 Simply Better and Cogeco Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simply Better Brands and Cogeco Communications, you can compare the effects of market volatilities on Simply Better and Cogeco Communications 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 Simply Better with a short position of Cogeco Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simply Better and Cogeco Communications.
Diversification Opportunities for Simply Better and Cogeco Communications
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Simply and Cogeco is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Simply Better Brands and Cogeco Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cogeco Communications and Simply Better 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 Simply Better Brands are associated (or correlated) with Cogeco Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cogeco Communications has no effect on the direction of Simply Better i.e., Simply Better and Cogeco Communications go up and down completely randomly.
Pair Corralation between Simply Better and Cogeco Communications
Assuming the 90 days trading horizon Simply Better Brands is expected to generate 3.11 times more return on investment than Cogeco Communications. However, Simply Better is 3.11 times more volatile than Cogeco Communications. It trades about 0.06 of its potential returns per unit of risk. Cogeco Communications is currently generating about 0.0 per unit of risk. If you would invest 42.00 in Simply Better Brands on November 2, 2024 and sell it today you would earn a total of 68.00 from holding Simply Better Brands or generate 161.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simply Better Brands vs. Cogeco Communications
Performance |
| Timeline |
| Simply Better Brands |
| Cogeco Communications |
Simply Better and Cogeco Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simply Better and Cogeco Communications
The main advantage of trading using opposite Simply Better and Cogeco Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simply Better position performs unexpectedly, Cogeco Communications 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 Cogeco Communications will offset losses from the drop in Cogeco Communications' long position.| Simply Better vs. NowVertical Group | Simply Better vs. Water Ways Technologies | Simply Better vs. Surge Battery Metals |
| Cogeco Communications vs. Cogeco Inc | Cogeco Communications vs. Quebecor | Cogeco Communications vs. Transcontinental | Cogeco Communications vs. Stella Jones |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |