Correlation Between Canadian General and Diamond Fields
Can any of the company-specific risk be diversified away by investing in both Canadian General and Diamond Fields 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 Canadian General and Diamond Fields into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian General Investments and Diamond Fields Resources, you can compare the effects of market volatilities on Canadian General and Diamond Fields 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 Canadian General with a short position of Diamond Fields. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian General and Diamond Fields.
Diversification Opportunities for Canadian General and Diamond Fields
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Canadian and Diamond is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Canadian General Investments and Diamond Fields Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamond Fields Resources and Canadian General 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 Canadian General Investments are associated (or correlated) with Diamond Fields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamond Fields Resources has no effect on the direction of Canadian General i.e., Canadian General and Diamond Fields go up and down completely randomly.
Pair Corralation between Canadian General and Diamond Fields
Assuming the 90 days trading horizon Canadian General Investments is expected to generate 0.09 times more return on investment than Diamond Fields. However, Canadian General Investments is 11.11 times less risky than Diamond Fields. It trades about 0.22 of its potential returns per unit of risk. Diamond Fields Resources is currently generating about 0.01 per unit of risk. If you would invest 3,550 in Canadian General Investments on April 25, 2025 and sell it today you would earn a total of 512.00 from holding Canadian General Investments or generate 14.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Canadian General Investments vs. Diamond Fields Resources
Performance |
Timeline |
Canadian General Inv |
Diamond Fields Resources |
Canadian General and Diamond Fields Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Canadian General and Diamond Fields
The main advantage of trading using opposite Canadian General and Diamond Fields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian General position performs unexpectedly, Diamond Fields 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 Diamond Fields will offset losses from the drop in Diamond Fields' long position.Canadian General vs. Accord Financial Corp | Canadian General vs. goeasy | Canadian General vs. Sangoma Technologies Corp | Canadian General vs. Brompton European Dividend |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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