Correlation Between Dream Office and Canadian General

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Can any of the company-specific risk be diversified away by investing in both Dream Office and Canadian General 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 Dream Office and Canadian General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dream Office Real and Canadian General Investments, you can compare the effects of market volatilities on Dream Office and Canadian General 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 Dream Office with a short position of Canadian General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dream Office and Canadian General.

Diversification Opportunities for Dream Office and Canadian General

0.68
  Correlation Coefficient

Poor diversification

The 3 months correlation between Dream and Canadian is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dream Office Real and Canadian General Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian General Inv and Dream Office 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 Dream Office Real are associated (or correlated) with Canadian General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian General Inv has no effect on the direction of Dream Office i.e., Dream Office and Canadian General go up and down completely randomly.

Pair Corralation between Dream Office and Canadian General

Assuming the 90 days trading horizon Dream Office is expected to generate 1.59 times less return on investment than Canadian General. In addition to that, Dream Office is 2.4 times more volatile than Canadian General Investments. It trades about 0.06 of its total potential returns per unit of risk. Canadian General Investments is currently generating about 0.24 per unit of volatility. If you would invest  3,525  in Canadian General Investments on April 24, 2025 and sell it today you would earn a total of  550.00  from holding Canadian General Investments or generate 15.6% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Dream Office Real  vs.  Canadian General Investments

 Performance 
       Timeline  
Dream Office Real 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Dream Office Real are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Dream Office may actually be approaching a critical reversion point that can send shares even higher in August 2025.
Canadian General Inv 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Canadian General Investments are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Canadian General displayed solid returns over the last few months and may actually be approaching a breakup point.

Dream Office and Canadian General Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Dream Office and Canadian General

The main advantage of trading using opposite Dream Office and Canadian General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dream Office position performs unexpectedly, Canadian General 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 Canadian General will offset losses from the drop in Canadian General's long position.
The idea behind Dream Office Real and Canadian General Investments 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.
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.

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