Correlation Between Definity Financial and Storage Vault
Can any of the company-specific risk be diversified away by investing in both Definity Financial and Storage Vault 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 Definity Financial and Storage Vault into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Definity Financial Corp and Storage Vault Canada, you can compare the effects of market volatilities on Definity Financial and Storage Vault 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 Definity Financial with a short position of Storage Vault. Check out your portfolio center. Please also check ongoing floating volatility patterns of Definity Financial and Storage Vault.
Diversification Opportunities for Definity Financial and Storage Vault
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Definity and Storage is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Definity Financial Corp and Storage Vault Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Storage Vault Canada and Definity Financial 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 Definity Financial Corp are associated (or correlated) with Storage Vault. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Storage Vault Canada has no effect on the direction of Definity Financial i.e., Definity Financial and Storage Vault go up and down completely randomly.
Pair Corralation between Definity Financial and Storage Vault
Assuming the 90 days trading horizon Definity Financial Corp is expected to generate 1.04 times more return on investment than Storage Vault. However, Definity Financial is 1.04 times more volatile than Storage Vault Canada. It trades about 0.17 of its potential returns per unit of risk. Storage Vault Canada is currently generating about 0.12 per unit of risk. If you would invest 6,407 in Definity Financial Corp on April 20, 2025 and sell it today you would earn a total of 1,394 from holding Definity Financial Corp or generate 21.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Definity Financial Corp vs. Storage Vault Canada
Performance |
Timeline |
Definity Financial Corp |
Storage Vault Canada |
Definity Financial and Storage Vault Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Definity Financial and Storage Vault
The main advantage of trading using opposite Definity Financial and Storage Vault positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Definity Financial position performs unexpectedly, Storage Vault 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 Storage Vault will offset losses from the drop in Storage Vault's long position.Definity Financial vs. Intact Financial | Definity Financial vs. Pet Valu Holdings | Definity Financial vs. Topaz Energy Corp | Definity Financial vs. Trisura Group |
Storage Vault vs. FirstService Corp | Storage Vault vs. Altus Group Limited | Storage Vault vs. Parkit Enterprise | Storage Vault vs. Colliers International Group |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |