Correlation Between Wishpond Technologies and Canaf Investments
Can any of the company-specific risk be diversified away by investing in both Wishpond Technologies and Canaf Investments 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 Wishpond Technologies and Canaf Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wishpond Technologies and Canaf Investments, you can compare the effects of market volatilities on Wishpond Technologies and Canaf Investments 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 Wishpond Technologies with a short position of Canaf Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wishpond Technologies and Canaf Investments.
Diversification Opportunities for Wishpond Technologies and Canaf Investments
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wishpond and Canaf is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Wishpond Technologies and Canaf Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canaf Investments and Wishpond 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 Wishpond Technologies are associated (or correlated) with Canaf Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canaf Investments has no effect on the direction of Wishpond Technologies i.e., Wishpond Technologies and Canaf Investments go up and down completely randomly.
Pair Corralation between Wishpond Technologies and Canaf Investments
Assuming the 90 days trading horizon Wishpond Technologies is expected to under-perform the Canaf Investments. In addition to that, Wishpond Technologies is 1.18 times more volatile than Canaf Investments. It trades about -0.08 of its total potential returns per unit of risk. Canaf Investments is currently generating about 0.05 per unit of volatility. If you would invest 27.00 in Canaf Investments on September 2, 2024 and sell it today you would earn a total of 2.00 from holding Canaf Investments or generate 7.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wishpond Technologies vs. Canaf Investments
Performance |
| Timeline |
| Wishpond Technologies |
| Canaf Investments |
Wishpond Technologies and Canaf Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wishpond Technologies and Canaf Investments
The main advantage of trading using opposite Wishpond Technologies and Canaf Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wishpond Technologies position performs unexpectedly, Canaf Investments 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 Canaf Investments will offset losses from the drop in Canaf Investments' long position.| Wishpond Technologies vs. Moovly Media | Wishpond Technologies vs. Lite Access Technologies | Wishpond Technologies vs. Braille Energy Systems | Wishpond Technologies vs. Solar Alliance Energy |
| Canaf Investments vs. First Majestic Silver | Canaf Investments vs. Ivanhoe Energy | Canaf Investments vs. Orezone Gold Corp | Canaf Investments vs. Faraday Copper Corp |
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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