Correlation Between CDN IMPERIAL and Infosys
Can any of the company-specific risk be diversified away by investing in both CDN IMPERIAL and Infosys 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 CDN IMPERIAL and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDN IMPERIAL BANK and Infosys Limited, you can compare the effects of market volatilities on CDN IMPERIAL and Infosys 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 CDN IMPERIAL with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDN IMPERIAL and Infosys.
Diversification Opportunities for CDN IMPERIAL and Infosys
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CDN and Infosys is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding CDN IMPERIAL BANK and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited and CDN IMPERIAL 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 CDN IMPERIAL BANK are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of CDN IMPERIAL i.e., CDN IMPERIAL and Infosys go up and down completely randomly.
Pair Corralation between CDN IMPERIAL and Infosys
Assuming the 90 days trading horizon CDN IMPERIAL BANK is expected to generate 0.38 times more return on investment than Infosys. However, CDN IMPERIAL BANK is 2.63 times less risky than Infosys. It trades about 0.39 of its potential returns per unit of risk. Infosys Limited is currently generating about 0.04 per unit of risk. If you would invest 5,236 in CDN IMPERIAL BANK on April 24, 2025 and sell it today you would earn a total of 1,082 from holding CDN IMPERIAL BANK or generate 20.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
CDN IMPERIAL BANK vs. Infosys Limited
Performance |
Timeline |
CDN IMPERIAL BANK |
Infosys Limited |
CDN IMPERIAL and Infosys Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CDN IMPERIAL and Infosys
The main advantage of trading using opposite CDN IMPERIAL and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDN IMPERIAL position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.CDN IMPERIAL vs. SINGAPORE AIRLINES | CDN IMPERIAL vs. AEGEAN AIRLINES | CDN IMPERIAL vs. Singapore Airlines Limited | CDN IMPERIAL vs. SmarTone Telecommunications Holdings |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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