Correlation Between Sienna Senior and Exchange Income
Can any of the company-specific risk be diversified away by investing in both Sienna Senior and Exchange Income 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 Exchange Income 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 Exchange Income, you can compare the effects of market volatilities on Sienna Senior and Exchange Income 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 Exchange Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sienna Senior and Exchange Income.
Diversification Opportunities for Sienna Senior and Exchange Income
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sienna and Exchange is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Sienna Senior Living and Exchange Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exchange Income 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 Exchange Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exchange Income has no effect on the direction of Sienna Senior i.e., Sienna Senior and Exchange Income go up and down completely randomly.
Pair Corralation between Sienna Senior and Exchange Income
Assuming the 90 days trading horizon Sienna Senior Living is expected to under-perform the Exchange Income. But the stock apears to be less risky and, when comparing its historical volatility, Sienna Senior Living is 1.16 times less risky than Exchange Income. The stock trades about -0.24 of its potential returns per unit of risk. The Exchange Income is currently generating about -0.18 of returns per unit of risk over similar time horizon. If you would invest 5,618 in Exchange Income on October 21, 2024 and sell it today you would lose (234.00) from holding Exchange Income or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sienna Senior Living vs. Exchange Income
Performance |
| Timeline |
| Sienna Senior Living |
| Exchange Income |
Sienna Senior and Exchange Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sienna Senior and Exchange Income
The main advantage of trading using opposite Sienna Senior and Exchange Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sienna Senior position performs unexpectedly, Exchange Income 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 Exchange Income will offset losses from the drop in Exchange Income'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 |
| Exchange Income vs. Capital Power | Exchange Income vs. Keyera Corp | Exchange Income vs. Parkland Fuel | Exchange Income vs. TFI International |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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