Correlation Between Senvest Capital and Canfor
Can any of the company-specific risk be diversified away by investing in both Senvest Capital and Canfor 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 Senvest Capital and Canfor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senvest Capital and Canfor, you can compare the effects of market volatilities on Senvest Capital and Canfor 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 Senvest Capital with a short position of Canfor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senvest Capital and Canfor.
Diversification Opportunities for Senvest Capital and Canfor
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Senvest and Canfor is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Senvest Capital and Canfor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canfor and Senvest Capital 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 Senvest Capital are associated (or correlated) with Canfor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canfor has no effect on the direction of Senvest Capital i.e., Senvest Capital and Canfor go up and down completely randomly.
Pair Corralation between Senvest Capital and Canfor
Assuming the 90 days trading horizon Senvest Capital is expected to generate 0.39 times more return on investment than Canfor. However, Senvest Capital is 2.6 times less risky than Canfor. It trades about 0.43 of its potential returns per unit of risk. Canfor is currently generating about -0.52 per unit of risk. If you would invest 33,000 in Senvest Capital on September 25, 2024 and sell it today you would earn a total of 2,000 from holding Senvest Capital or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Senvest Capital vs. Canfor
Performance |
| Timeline |
| Senvest Capital |
| Canfor |
Senvest Capital and Canfor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senvest Capital and Canfor
The main advantage of trading using opposite Senvest Capital and Canfor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senvest Capital position performs unexpectedly, Canfor 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 Canfor will offset losses from the drop in Canfor's long position.| Senvest Capital vs. Firan Technology Group | Senvest Capital vs. Brookfield Office Properties | Senvest Capital vs. Income Financial Trust | Senvest Capital vs. Ocumetics Technology Corp |
| Canfor vs. Converge Technology Solutions | Canfor vs. Element Fleet Management | Canfor vs. Sparx Technology | Canfor vs. Tree Island Steel |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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