Correlation Between Ximen Mining and RioCan Real
Can any of the company-specific risk be diversified away by investing in both Ximen Mining and RioCan Real 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 Ximen Mining and RioCan Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ximen Mining Corp and RioCan Real Estate, you can compare the effects of market volatilities on Ximen Mining and RioCan Real 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 Ximen Mining with a short position of RioCan Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ximen Mining and RioCan Real.
Diversification Opportunities for Ximen Mining and RioCan Real
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ximen and RioCan is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ximen Mining Corp and RioCan Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RioCan Real Estate and Ximen Mining 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 Ximen Mining Corp are associated (or correlated) with RioCan Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RioCan Real Estate has no effect on the direction of Ximen Mining i.e., Ximen Mining and RioCan Real go up and down completely randomly.
Pair Corralation between Ximen Mining and RioCan Real
Assuming the 90 days horizon Ximen Mining Corp is expected to under-perform the RioCan Real. In addition to that, Ximen Mining is 6.01 times more volatile than RioCan Real Estate. It trades about -0.1 of its total potential returns per unit of risk. RioCan Real Estate is currently generating about -0.1 per unit of volatility. If you would invest 1,965 in RioCan Real Estate on October 22, 2024 and sell it today you would lose (135.00) from holding RioCan Real Estate or give up 6.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Ximen Mining Corp vs. RioCan Real Estate
Performance |
| Timeline |
| Ximen Mining Corp |
| RioCan Real Estate |
Ximen Mining and RioCan Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ximen Mining and RioCan Real
The main advantage of trading using opposite Ximen Mining and RioCan Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ximen Mining position performs unexpectedly, RioCan Real 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 RioCan Real will offset losses from the drop in RioCan Real's long position.The idea behind Ximen Mining Corp and RioCan Real Estate pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| RioCan Real vs. SmartCentres Real Estate | RioCan Real vs. HR Real Estate | RioCan Real vs. Fortis Inc | RioCan Real vs. Enbridge |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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