Correlation Between Canlan Ice and Kaltura

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

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

Diversification Opportunities for Canlan Ice and Kaltura

0.16

Correlation Coefficient

Canlan Ice  Kaltura

Average diversification

The 3 months correlation between Canlan and Kaltura is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Canlan Ice Sports and Kaltura in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaltura and Canlan Ice 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 Canlan Ice Sports are associated (or correlated) with Kaltura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaltura has no effect on the direction of Canlan Ice i.e., Canlan Ice and Kaltura go up and down completely randomly.

Pair Corralation between Canlan Ice and Kaltura

Assuming the 90 days horizon Canlan Ice Sports is expected to generate 0.04 times more return on investment than Kaltura. However, Canlan Ice Sports is 22.29 times less risky than Kaltura. It trades about 0.22 of its potential returns per unit of risk. Kaltura is currently generating about -0.05 per unit of risk. If you would invest  294.00  in Canlan Ice Sports on October 4, 2024 and sell it today you would earn a total of  3.00  from holding Canlan Ice Sports or generate 1.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Canlan Ice Sports  vs.  Kaltura

Canlan Ice Sports

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Canlan Ice Sports are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Canlan Ice is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Kaltura

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Canlan Ice and Kaltura

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

The idea behind Canlan Ice Sports and Kaltura 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.