Correlation Between Canadian Western and Greenville Federal

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

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

Diversification Opportunities for Canadian Western and Greenville Federal

0.0

Correlation Coefficient

Canadian Western  Greenville Federal

Pay attention - limited upside

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

Pair Corralation between Canadian Western and Greenville Federal

If you would invest  700.00  in Greenville Federal Financial on October 4, 2024 and sell it today you would earn a total of  15.00  from holding Greenville Federal Financial or generate 2.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Canadian Western Bank  vs.  Greenville Federal Financial

Canadian Western Bank

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Canadian Western Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, Canadian Western is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Greenville Federal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greenville Federal Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Greenville Federal is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Canadian Western and Greenville Federal

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

The idea behind Canadian Western Bank and Greenville Federal Financial 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.