Correlation Between Netflix and CANADIAN NORTH

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

By analyzing existing cross correlation between Netflix and CANADIAN NORTH RESOURCES, you can compare the effects of market volatilities on Netflix and CANADIAN NORTH 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 Netflix with a short position of CANADIAN NORTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and CANADIAN NORTH.

Diversification Opportunities for Netflix and CANADIAN NORTH

-0.64

Correlation Coefficient

Netflix  CANADIAN NORTH

Excellent diversification

The 3 months correlation between Netflix and CANADIAN is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and CANADIAN NORTH RESOURCES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CANADIAN NORTH RESOURCES and Netflix 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 Netflix are associated (or correlated) with CANADIAN NORTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CANADIAN NORTH RESOURCES has no effect on the direction of Netflix i.e., Netflix and CANADIAN NORTH go up and down completely randomly.

Pair Corralation between Netflix and CANADIAN NORTH

Assuming the 90 days horizon Netflix is expected to generate 0.33 times more return on investment than CANADIAN NORTH. However, Netflix is 3.07 times less risky than CANADIAN NORTH. It trades about 0.06 of its potential returns per unit of risk. CANADIAN NORTH RESOURCES is currently generating about -0.09 per unit of risk. If you would invest  96,360  in Netflix on April 24, 2025 and sell it today you would earn a total of  5,000  from holding Netflix or generate 5.19% return on investment over 90 days.

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

Netflix  vs.  CANADIAN NORTH RESOURCES

Netflix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Netflix are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Netflix is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

CANADIAN NORTH RESOURCES

Risk-Adjusted Performance

Very Weak

Over the last 90 days CANADIAN NORTH RESOURCES has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Netflix and CANADIAN NORTH

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

The idea behind Netflix and CANADIAN NORTH RESOURCES 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.