Correlation Between Westshore Terminals and Laurentian Bank
Can any of the company-specific risk be diversified away by investing in both Westshore Terminals and Laurentian Bank 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 Laurentian Bank 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 Laurentian Bank, you can compare the effects of market volatilities on Westshore Terminals and Laurentian Bank 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 Laurentian Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westshore Terminals and Laurentian Bank.
Diversification Opportunities for Westshore Terminals and Laurentian Bank
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Westshore and Laurentian is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Westshore Terminals Investment and Laurentian Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laurentian Bank 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 Laurentian Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laurentian Bank has no effect on the direction of Westshore Terminals i.e., Westshore Terminals and Laurentian Bank go up and down completely randomly.
Pair Corralation between Westshore Terminals and Laurentian Bank
Assuming the 90 days trading horizon Westshore Terminals Investment is expected to generate 0.77 times more return on investment than Laurentian Bank. However, Westshore Terminals Investment is 1.31 times less risky than Laurentian Bank. It trades about 0.01 of its potential returns per unit of risk. Laurentian Bank is currently generating about 0.0 per unit of risk. If you would invest 2,279 in Westshore Terminals Investment on November 9, 2024 and sell it today you would earn a total of 31.00 from holding Westshore Terminals Investment or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Westshore Terminals Investment vs. Laurentian Bank
Performance |
| Timeline |
| Westshore Terminals |
| Laurentian Bank |
Westshore Terminals and Laurentian Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westshore Terminals and Laurentian Bank
The main advantage of trading using opposite Westshore Terminals and Laurentian Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westshore Terminals position performs unexpectedly, Laurentian Bank 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 Laurentian Bank will offset losses from the drop in Laurentian Bank's long position.| Westshore Terminals vs. Mullen Group | Westshore Terminals vs. Ritchie Bros Auctioneers | Westshore Terminals vs. Winpak | Westshore Terminals vs. North West |
| Laurentian Bank vs. Canadian Western Bank | Laurentian Bank vs. National Bank of | Laurentian Bank vs. Canadian Imperial Bank | Laurentian Bank vs. Great West Lifeco |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |