Correlation Between Westshore Terminals and BROOKFIELD REINSURANCE
Can any of the company-specific risk be diversified away by investing in both Westshore Terminals and BROOKFIELD REINSURANCE 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 Westshore Terminals and BROOKFIELD REINSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westshore Terminals Investment and BROOKFIELD REINSURANCE LTD, you can compare the effects of market volatilities on Westshore Terminals and BROOKFIELD REINSURANCE 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 Westshore Terminals with a short position of BROOKFIELD REINSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westshore Terminals and BROOKFIELD REINSURANCE.
Diversification Opportunities for Westshore Terminals and BROOKFIELD REINSURANCE
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Westshore and BROOKFIELD is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Westshore Terminals Investment and BROOKFIELD REINSURANCE LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BROOKFIELD REINSURANCE and Westshore Terminals 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 Westshore Terminals Investment are associated (or correlated) with BROOKFIELD REINSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BROOKFIELD REINSURANCE has no effect on the direction of Westshore Terminals i.e., Westshore Terminals and BROOKFIELD REINSURANCE go up and down completely randomly.
Pair Corralation between Westshore Terminals and BROOKFIELD REINSURANCE
Assuming the 90 days trading horizon Westshore Terminals is expected to generate 4.2 times less return on investment than BROOKFIELD REINSURANCE. But when comparing it to its historical volatility, Westshore Terminals Investment is 1.72 times less risky than BROOKFIELD REINSURANCE. It trades about 0.13 of its potential returns per unit of risk. BROOKFIELD REINSURANCE LTD is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 7,589 in BROOKFIELD REINSURANCE LTD on August 27, 2024 and sell it today you would earn a total of 384.00 from holding BROOKFIELD REINSURANCE LTD or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 47.62% |
| Values | Daily Returns |
Westshore Terminals Investment vs. BROOKFIELD REINSURANCE LTD
Performance |
| Timeline |
| Westshore Terminals |
| BROOKFIELD REINSURANCE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Westshore Terminals and BROOKFIELD REINSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westshore Terminals and BROOKFIELD REINSURANCE
The main advantage of trading using opposite Westshore Terminals and BROOKFIELD REINSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westshore Terminals position performs unexpectedly, BROOKFIELD REINSURANCE 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 BROOKFIELD REINSURANCE will offset losses from the drop in BROOKFIELD REINSURANCE's long position.| Westshore Terminals vs. Mullen Group | Westshore Terminals vs. Ritchie Bros Auctioneers | Westshore Terminals vs. Winpak | Westshore Terminals vs. North West |
| BROOKFIELD REINSURANCE vs. Brookfield Investments | BROOKFIELD REINSURANCE vs. Perseus Mining | BROOKFIELD REINSURANCE vs. CNJ Capital Investments | BROOKFIELD REINSURANCE vs. Canadian General Investments |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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