Correlation Between Canadian Imperial and Apple

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

By analyzing existing cross correlation between Canadian Imperial Bank and Apple Inc, you can compare the effects of market volatilities on Canadian Imperial and Apple 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 Canadian Imperial with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Imperial and Apple.

Diversification Opportunities for Canadian Imperial and Apple

0.0

Correlation Coefficient

Canadian Imperial  Apple

Pay attention - limited upside

The 3 months correlation between Canadian and Apple is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Imperial Bank and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Canadian Imperial 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 Canadian Imperial Bank are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of Canadian Imperial i.e., Canadian Imperial and Apple go up and down completely randomly.

Pair Corralation between Canadian Imperial and Apple

If you would invest  0.00  in Canadian Imperial Bank on October 26, 2024 and sell it today you would earn a total of  0.00  from holding Canadian Imperial Bank or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Canadian Imperial Bank  vs.  Apple Inc

Canadian Imperial Bank

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Canadian Imperial Bank has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Canadian Imperial is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Apple Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Apple is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Canadian Imperial and Apple

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

The idea behind Canadian Imperial Bank and Apple Inc 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.