Correlation Between ASURE SOFTWARE and CDN IMPERIAL
Can any of the company-specific risk be diversified away by investing in both ASURE SOFTWARE and CDN IMPERIAL 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 ASURE SOFTWARE and CDN IMPERIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASURE SOFTWARE and CDN IMPERIAL BANK, you can compare the effects of market volatilities on ASURE SOFTWARE and CDN IMPERIAL 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 ASURE SOFTWARE with a short position of CDN IMPERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASURE SOFTWARE and CDN IMPERIAL.
Diversification Opportunities for ASURE SOFTWARE and CDN IMPERIAL
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ASURE and CDN is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ASURE SOFTWARE and CDN IMPERIAL BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN IMPERIAL BANK and ASURE SOFTWARE 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 ASURE SOFTWARE are associated (or correlated) with CDN IMPERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN IMPERIAL BANK has no effect on the direction of ASURE SOFTWARE i.e., ASURE SOFTWARE and CDN IMPERIAL go up and down completely randomly.
Pair Corralation between ASURE SOFTWARE and CDN IMPERIAL
Assuming the 90 days trading horizon ASURE SOFTWARE is expected to under-perform the CDN IMPERIAL. In addition to that, ASURE SOFTWARE is 2.25 times more volatile than CDN IMPERIAL BANK. It trades about -0.01 of its total potential returns per unit of risk. CDN IMPERIAL BANK is currently generating about 0.2 per unit of volatility. If you would invest 6,081 in CDN IMPERIAL BANK on September 12, 2024 and sell it today you would earn a total of 312.00 from holding CDN IMPERIAL BANK or generate 5.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASURE SOFTWARE vs. CDN IMPERIAL BANK
Performance |
| Timeline |
| ASURE SOFTWARE |
| CDN IMPERIAL BANK |
ASURE SOFTWARE and CDN IMPERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASURE SOFTWARE and CDN IMPERIAL
The main advantage of trading using opposite ASURE SOFTWARE and CDN IMPERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASURE SOFTWARE position performs unexpectedly, CDN IMPERIAL 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 CDN IMPERIAL will offset losses from the drop in CDN IMPERIAL's long position.| ASURE SOFTWARE vs. Iridium Communications | ASURE SOFTWARE vs. AWILCO DRILLING PLC | ASURE SOFTWARE vs. Entravision Communications | ASURE SOFTWARE vs. PRECISION DRILLING P |
| CDN IMPERIAL vs. JD SPORTS FASH | CDN IMPERIAL vs. KRAKATAU STEEL B | CDN IMPERIAL vs. BlueScope Steel Limited | CDN IMPERIAL vs. MITSUBISHI STEEL MFG |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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