Correlation Between Sensient Technologies and Canlan Ice
Can any of the company-specific risk be diversified away by investing in both Sensient Technologies and Canlan Ice 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 Canlan Ice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensient Technologies and Canlan Ice Sports, you can compare the effects of market volatilities on Sensient Technologies and Canlan Ice 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 Canlan Ice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensient Technologies and Canlan Ice.
Diversification Opportunities for Sensient Technologies and Canlan Ice
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sensient and Canlan is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and Canlan Ice Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canlan Ice Sports 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 Canlan Ice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canlan Ice Sports has no effect on the direction of Sensient Technologies i.e., Sensient Technologies and Canlan Ice go up and down completely randomly.
Pair Corralation between Sensient Technologies and Canlan Ice
If you would invest 7,126 in Sensient Technologies on November 1, 2024 and sell it today you would earn a total of 429.00 from holding Sensient Technologies or generate 6.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sensient Technologies vs. Canlan Ice Sports
Performance |
| Timeline |
| Sensient Technologies |
| Canlan Ice Sports |
Sensient Technologies and Canlan Ice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensient Technologies and Canlan Ice
The main advantage of trading using opposite Sensient Technologies and Canlan Ice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensient Technologies position performs unexpectedly, Canlan Ice 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 Canlan Ice will offset losses from the drop in Canlan Ice's long position.| Sensient Technologies vs. Innospec | Sensient Technologies vs. Minerals Technologies | Sensient Technologies vs. Oil Dri | Sensient Technologies vs. H B Fuller |
| Canlan Ice vs. Encore Capital Group | Canlan Ice vs. Cheche Group Class | Canlan Ice vs. Univest Pennsylvania | Canlan Ice vs. Constellation Brands Class |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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