Correlation Between Sienna Senior and Canadian Apartment
Can any of the company-specific risk be diversified away by investing in both Sienna Senior and Canadian Apartment 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 Sienna Senior and Canadian Apartment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sienna Senior Living and Canadian Apartment Properties, you can compare the effects of market volatilities on Sienna Senior and Canadian Apartment 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 Sienna Senior with a short position of Canadian Apartment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sienna Senior and Canadian Apartment.
Diversification Opportunities for Sienna Senior and Canadian Apartment
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sienna and Canadian is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Sienna Senior Living and Canadian Apartment Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Apartment and Sienna Senior 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 Sienna Senior Living are associated (or correlated) with Canadian Apartment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Apartment has no effect on the direction of Sienna Senior i.e., Sienna Senior and Canadian Apartment go up and down completely randomly.
Pair Corralation between Sienna Senior and Canadian Apartment
Assuming the 90 days trading horizon Sienna Senior Living is expected to generate 1.05 times more return on investment than Canadian Apartment. However, Sienna Senior is 1.05 times more volatile than Canadian Apartment Properties. It trades about 0.13 of its potential returns per unit of risk. Canadian Apartment Properties is currently generating about 0.0 per unit of risk. If you would invest 1,262 in Sienna Senior Living on September 1, 2024 and sell it today you would earn a total of 436.00 from holding Sienna Senior Living or generate 34.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Sienna Senior Living vs. Canadian Apartment Properties
Performance |
| Timeline |
| Sienna Senior Living |
| Canadian Apartment |
Sienna Senior and Canadian Apartment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sienna Senior and Canadian Apartment
The main advantage of trading using opposite Sienna Senior and Canadian Apartment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sienna Senior position performs unexpectedly, Canadian Apartment 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 Canadian Apartment will offset losses from the drop in Canadian Apartment's long position.| Sienna Senior vs. Extendicare | Sienna Senior vs. Chartwell Retirement Residences | Sienna Senior vs. NorthWest Healthcare Properties | Sienna Senior vs. Dream Industrial Real |
| Canadian Apartment vs. Allied Properties Real | Canadian Apartment vs. Granite Real Estate | Canadian Apartment vs. Boardwalk Real Estate | Canadian Apartment vs. HR Real Estate |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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