Correlation Between Stantec and Genesis Land
Can any of the company-specific risk be diversified away by investing in both Stantec and Genesis Land 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 Stantec and Genesis Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stantec and Genesis Land Development, you can compare the effects of market volatilities on Stantec and Genesis Land 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 Stantec with a short position of Genesis Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stantec and Genesis Land.
Diversification Opportunities for Stantec and Genesis Land
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stantec and Genesis is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Stantec and Genesis Land Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Land Development and Stantec 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 Stantec are associated (or correlated) with Genesis Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Land Development has no effect on the direction of Stantec i.e., Stantec and Genesis Land go up and down completely randomly.
Pair Corralation between Stantec and Genesis Land
Assuming the 90 days trading horizon Stantec is expected to generate 4.05 times less return on investment than Genesis Land. But when comparing it to its historical volatility, Stantec is 2.06 times less risky than Genesis Land. It trades about 0.05 of its potential returns per unit of risk. Genesis Land Development is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 208.00 in Genesis Land Development on September 27, 2024 and sell it today you would earn a total of 135.00 from holding Genesis Land Development or generate 64.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.15% |
| Values | Daily Returns |
Stantec vs. Genesis Land Development
Performance |
| Timeline |
| Stantec |
| Genesis Land Development |
Stantec and Genesis Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stantec and Genesis Land
The main advantage of trading using opposite Stantec and Genesis Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stantec position performs unexpectedly, Genesis Land 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 Genesis Land will offset losses from the drop in Genesis Land's long position.| Stantec vs. Toromont Industries | Stantec vs. WSP Global | Stantec vs. Ritchie Bros Auctioneers | Stantec vs. Stella Jones |
| Genesis Land vs. Colliers International Group | Genesis Land vs. CCL Industries | Genesis Land vs. Ritchie Bros Auctioneers | Genesis Land vs. Stantec |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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