Correlation Between Senvest Capital and Winpak
Can any of the company-specific risk be diversified away by investing in both Senvest Capital and Winpak 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 Winpak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senvest Capital and Winpak, you can compare the effects of market volatilities on Senvest Capital and Winpak 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 Winpak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senvest Capital and Winpak.
Diversification Opportunities for Senvest Capital and Winpak
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Senvest and Winpak is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Senvest Capital and Winpak in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winpak 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 Winpak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winpak has no effect on the direction of Senvest Capital i.e., Senvest Capital and Winpak go up and down completely randomly.
Pair Corralation between Senvest Capital and Winpak
Assuming the 90 days trading horizon Senvest Capital is expected to generate 1.69 times less return on investment than Winpak. But when comparing it to its historical volatility, Senvest Capital is 2.98 times less risky than Winpak. It trades about 0.22 of its potential returns per unit of risk. Winpak is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,929 in Winpak on August 28, 2024 and sell it today you would earn a total of 125.00 from holding Winpak or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senvest Capital vs. Winpak
Performance |
| Timeline |
| Senvest Capital |
| Winpak |
Senvest Capital and Winpak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senvest Capital and Winpak
The main advantage of trading using opposite Senvest Capital and Winpak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senvest Capital position performs unexpectedly, Winpak 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 Winpak will offset losses from the drop in Winpak's long position.| Senvest Capital vs. Canaf Investments | Senvest Capital vs. Canadian General Investments | Senvest Capital vs. Economic Investment Trust | Senvest Capital vs. Air Canada |
| Winpak vs. HPQ Silicon Resources | Winpak vs. Champion Iron | Winpak vs. Osisko Metals | Winpak vs. Bip Investment Corp |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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