Correlation Between Westaim Corp and Aptose Biosciences
Can any of the company-specific risk be diversified away by investing in both Westaim Corp and Aptose Biosciences 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 Westaim Corp and Aptose Biosciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westaim Corp and Aptose Biosciences, you can compare the effects of market volatilities on Westaim Corp and Aptose Biosciences 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 Westaim Corp with a short position of Aptose Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westaim Corp and Aptose Biosciences.
Diversification Opportunities for Westaim Corp and Aptose Biosciences
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Westaim and Aptose is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Westaim Corp and Aptose Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptose Biosciences and Westaim Corp 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 Westaim Corp are associated (or correlated) with Aptose Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptose Biosciences has no effect on the direction of Westaim Corp i.e., Westaim Corp and Aptose Biosciences go up and down completely randomly.
Pair Corralation between Westaim Corp and Aptose Biosciences
Assuming the 90 days horizon Westaim Corp is expected to generate 0.4 times more return on investment than Aptose Biosciences. However, Westaim Corp is 2.52 times less risky than Aptose Biosciences. It trades about 0.14 of its potential returns per unit of risk. Aptose Biosciences is currently generating about -0.17 per unit of risk. If you would invest 397.00 in Westaim Corp on September 4, 2024 and sell it today you would earn a total of 114.00 from holding Westaim Corp or generate 28.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.81% |
| Values | Daily Returns |
Westaim Corp vs. Aptose Biosciences
Performance |
| Timeline |
| Westaim Corp |
| Aptose Biosciences |
Westaim Corp and Aptose Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westaim Corp and Aptose Biosciences
The main advantage of trading using opposite Westaim Corp and Aptose Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westaim Corp position performs unexpectedly, Aptose Biosciences 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 Aptose Biosciences will offset losses from the drop in Aptose Biosciences' long position.| Westaim Corp vs. iShares Canadian HYBrid | Westaim Corp vs. Altagas Cum Red | Westaim Corp vs. European Residential Real | Westaim Corp vs. iShares Fundamental Hedged |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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