Correlation Between Winpak and Altus Group

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

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

Diversification Opportunities for Winpak and Altus Group

0.43

Correlation Coefficient

Winpak  Altus Group

Very weak diversification

The 3 months correlation between Winpak and Altus is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Winpak and Altus Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altus Group Limited and Winpak 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 Winpak are associated (or correlated) with Altus Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altus Group Limited has no effect on the direction of Winpak i.e., Winpak and Altus Group go up and down completely randomly.

Pair Corralation between Winpak and Altus Group

Assuming the 90 days trading horizon Winpak is expected to generate 1.05 times less return on investment than Altus Group. But when comparing it to its historical volatility, Winpak is 1.22 times less risky than Altus Group. It trades about 0.17 of its potential returns per unit of risk. Altus Group Limited is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  4,912  in Altus Group Limited on April 21, 2025 and sell it today you would earn a total of  513.00  from holding Altus Group Limited or generate 10.44% return on investment over 90 days.

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

Winpak  vs.  Altus Group Limited

Winpak

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Winpak are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward-looking signals, Winpak may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Altus Group Limited

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Altus Group Limited are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, Altus Group may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Winpak and Altus Group

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

The idea behind Winpak and Altus Group Limited 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.