Correlation Between Sensient Technologies and Corus Entertainment
Can any of the company-specific risk be diversified away by investing in both Sensient Technologies and Corus Entertainment 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 Sensient Technologies and Corus Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensient Technologies and Corus Entertainment, you can compare the effects of market volatilities on Sensient Technologies and Corus Entertainment 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 Sensient Technologies with a short position of Corus Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensient Technologies and Corus Entertainment.
Diversification Opportunities for Sensient Technologies and Corus Entertainment
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sensient and Corus is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and Corus Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corus Entertainment and Sensient Technologies 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 Sensient Technologies are associated (or correlated) with Corus Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corus Entertainment has no effect on the direction of Sensient Technologies i.e., Sensient Technologies and Corus Entertainment go up and down completely randomly.
Pair Corralation between Sensient Technologies and Corus Entertainment
Considering the 90-day investment horizon Sensient Technologies is expected to generate 0.4 times more return on investment than Corus Entertainment. However, Sensient Technologies is 2.52 times less risky than Corus Entertainment. It trades about 0.02 of its potential returns per unit of risk. Corus Entertainment is currently generating about -0.01 per unit of risk. If you would invest 6,907 in Sensient Technologies on September 5, 2024 and sell it today you would earn a total of 897.00 from holding Sensient Technologies or generate 12.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 30.3% |
| Values | Daily Returns |
Sensient Technologies vs. Corus Entertainment
Performance |
| Timeline |
| Sensient Technologies |
| Corus Entertainment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sensient Technologies and Corus Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensient Technologies and Corus Entertainment
The main advantage of trading using opposite Sensient Technologies and Corus Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensient Technologies position performs unexpectedly, Corus Entertainment 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 Corus Entertainment will offset losses from the drop in Corus Entertainment's long position.The idea behind Sensient Technologies and Corus Entertainment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Corus Entertainment vs. Saia Inc | Corus Entertainment vs. Sensient Technologies | Corus Entertainment vs. Apogee Enterprises | Corus Entertainment vs. Hooker Furniture |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stocks Directory Find actively traded stocks across global markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |