Correlation Between Corus Entertainment and Algonquin Power

Can any of the company-specific risk be diversified away by investing in both Corus Entertainment and Algonquin Power 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 Corus Entertainment and Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Corus Entertainment and Algonquin Power Utilities, you can compare the effects of market volatilities on Corus Entertainment and Algonquin Power 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 Corus Entertainment with a short position of Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corus Entertainment and Algonquin Power.

Diversification Opportunities for Corus Entertainment and Algonquin Power

-0.2

Correlation Coefficient

Corus Entertainment  Algonquin Power

Good diversification

The 3 months correlation between Corus and Algonquin is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Corus Entertainment and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities and Corus Entertainment 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 Corus Entertainment are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of Corus Entertainment i.e., Corus Entertainment and Algonquin Power go up and down completely randomly.

Pair Corralation between Corus Entertainment and Algonquin Power

Assuming the 90 days trading horizon Corus Entertainment is expected to generate 8.38 times less return on investment than Algonquin Power. In addition to that, Corus Entertainment is 8.21 times more volatile than Algonquin Power Utilities. It trades about 0.0 of its total potential returns per unit of risk. Algonquin Power Utilities is currently generating about 0.21 per unit of volatility. If you would invest  2,345  in Algonquin Power Utilities on April 25, 2025 and sell it today you would earn a total of  172.00  from holding Algonquin Power Utilities or generate 7.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Corus Entertainment  vs.  Algonquin Power Utilities

Corus Entertainment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Corus Entertainment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Corus Entertainment is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Algonquin Power Utilities

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Algonquin Power Utilities are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Algonquin Power may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Corus Entertainment and Algonquin Power

The main advantage of trading using opposite Corus Entertainment and Algonquin Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corus Entertainment position performs unexpectedly, Algonquin Power 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 Algonquin Power will offset losses from the drop in Algonquin Power's long position.

The idea behind Corus Entertainment and Algonquin Power Utilities 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.

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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.