Correlation Between CANON MARKETING and FORWARD AIR

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

By analyzing existing cross correlation between CANON MARKETING JP and FORWARD AIR P, you can compare the effects of market volatilities on CANON MARKETING and FORWARD AIR 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 CANON MARKETING with a short position of FORWARD AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of CANON MARKETING and FORWARD AIR.

Diversification Opportunities for CANON MARKETING and FORWARD AIR

-0.5

Correlation Coefficient

CANON MARKETING  FORWARD AIR

Very good diversification

The 3 months correlation between CANON and FORWARD is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding CANON MARKETING JP and FORWARD AIR P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FORWARD AIR P and CANON MARKETING 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 CANON MARKETING JP are associated (or correlated) with FORWARD AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FORWARD AIR P has no effect on the direction of CANON MARKETING i.e., CANON MARKETING and FORWARD AIR go up and down completely randomly.

Pair Corralation between CANON MARKETING and FORWARD AIR

Assuming the 90 days trading horizon CANON MARKETING JP is expected to under-perform the FORWARD AIR. But the stock apears to be less risky and, when comparing its historical volatility, CANON MARKETING JP is 3.07 times less risky than FORWARD AIR. The stock trades about -0.06 of its potential returns per unit of risk. The FORWARD AIR P is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  3,180  in FORWARD AIR P on October 10, 2024 and sell it today you would earn a total of  20.00  from holding FORWARD AIR P or generate 0.63% return on investment over 90 days.

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

CANON MARKETING JP  vs.  FORWARD AIR P

CANON MARKETING JP

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CANON MARKETING JP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile forward-looking indicators, CANON MARKETING may actually be approaching a critical reversion point that can send shares even higher in February 2025.

FORWARD AIR P

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FORWARD AIR P are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, FORWARD AIR is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CANON MARKETING and FORWARD AIR

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

The idea behind CANON MARKETING JP and FORWARD AIR P 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.