Correlation Between Canada Goose and Lightspeed Commerce

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

Diversification Opportunities for Canada Goose and Lightspeed Commerce

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between Canada and Lightspeed is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Canada Goose Holdings and Lightspeed Commerce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lightspeed Commerce and Canada Goose 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 Canada Goose Holdings are associated (or correlated) with Lightspeed Commerce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lightspeed Commerce has no effect on the direction of Canada Goose i.e., Canada Goose and Lightspeed Commerce go up and down completely randomly.

Pair Corralation between Canada Goose and Lightspeed Commerce

Assuming the 90 days trading horizon Canada Goose Holdings is expected to generate 1.31 times more return on investment than Lightspeed Commerce. However, Canada Goose is 1.31 times more volatile than Lightspeed Commerce. It trades about 0.25 of its potential returns per unit of risk. Lightspeed Commerce is currently generating about 0.17 per unit of risk. If you would invest  1,180  in Canada Goose Holdings on April 23, 2025 and sell it today you would earn a total of  761.00  from holding Canada Goose Holdings or generate 64.49% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Canada Goose Holdings  vs.  Lightspeed Commerce

 Performance 
       Timeline  
Canada Goose Holdings 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Canada Goose Holdings are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Canada Goose displayed solid returns over the last few months and may actually be approaching a breakup point.
Lightspeed Commerce 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Lightspeed Commerce are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Lightspeed Commerce displayed solid returns over the last few months and may actually be approaching a breakup point.

Canada Goose and Lightspeed Commerce Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Canada Goose and Lightspeed Commerce

The main advantage of trading using opposite Canada Goose and Lightspeed Commerce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canada Goose position performs unexpectedly, Lightspeed Commerce 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 Lightspeed Commerce will offset losses from the drop in Lightspeed Commerce's long position.
The idea behind Canada Goose Holdings and Lightspeed Commerce 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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