Correlation Between CANON MARKETING and Peoples Insurance

Can any of the company-specific risk be diversified away by investing in both CANON MARKETING and Peoples Insurance 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 CANON MARKETING and Peoples Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CANON MARKETING JP and The Peoples Insurance, you can compare the effects of market volatilities on CANON MARKETING and Peoples Insurance 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 CANON MARKETING with a short position of Peoples Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of CANON MARKETING and Peoples Insurance.

Diversification Opportunities for CANON MARKETING and Peoples Insurance

0.04

Correlation Coefficient

CANON MARKETING  Peoples Insurance

Significant diversification

The 3 months correlation between CANON and Peoples is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding CANON MARKETING JP and The Peoples Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peoples Insurance and CANON MARKETING 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 CANON MARKETING JP are associated (or correlated) with Peoples Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peoples Insurance has no effect on the direction of CANON MARKETING i.e., CANON MARKETING and Peoples Insurance go up and down completely randomly.

Pair Corralation between CANON MARKETING and Peoples Insurance

Assuming the 90 days trading horizon CANON MARKETING is expected to generate 12.05 times less return on investment than Peoples Insurance. But when comparing it to its historical volatility, CANON MARKETING JP is 1.42 times less risky than Peoples Insurance. It trades about 0.02 of its potential returns per unit of risk. The Peoples Insurance is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  49.00  in The Peoples Insurance on April 24, 2025 and sell it today you would earn a total of  13.00  from holding The Peoples Insurance or generate 26.53% return on investment over 90 days.

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

CANON MARKETING JP  vs.  The Peoples Insurance

CANON MARKETING JP

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CANON MARKETING JP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward-looking indicators, CANON MARKETING is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Peoples Insurance

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Peoples Insurance are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Peoples Insurance reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CANON MARKETING and Peoples Insurance

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

The idea behind CANON MARKETING JP and The Peoples Insurance 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 Global Correlations module to find global opportunities by holding instruments from different markets.