Correlation Between Canadian Utilities and Bet-at-home
Can any of the company-specific risk be diversified away by investing in both Canadian Utilities and Bet-at-home 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 Utilities and Bet-at-home into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian Utilities Limited and bet at home AG, you can compare the effects of market volatilities on Canadian Utilities and Bet-at-home 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 Utilities with a short position of Bet-at-home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Utilities and Bet-at-home.
Diversification Opportunities for Canadian Utilities and Bet-at-home
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Canadian and Bet-at-home is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Utilities Limited and bet at home AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on bet at home and Canadian Utilities 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 Utilities Limited are associated (or correlated) with Bet-at-home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of bet at home has no effect on the direction of Canadian Utilities i.e., Canadian Utilities and Bet-at-home go up and down completely randomly.
Pair Corralation between Canadian Utilities and Bet-at-home
Assuming the 90 days horizon Canadian Utilities Limited is expected to generate 0.3 times more return on investment than Bet-at-home. However, Canadian Utilities Limited is 3.37 times less risky than Bet-at-home. It trades about 0.08 of its potential returns per unit of risk. bet at home AG is currently generating about 0.02 per unit of risk. If you would invest 1,954 in Canadian Utilities Limited on September 24, 2024 and sell it today you would earn a total of 321.00 from holding Canadian Utilities Limited or generate 16.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Canadian Utilities Limited vs. bet at home AG
Performance |
Timeline |
Canadian Utilities |
bet at home |
Canadian Utilities and Bet-at-home Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Canadian Utilities and Bet-at-home
The main advantage of trading using opposite Canadian Utilities and Bet-at-home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Utilities position performs unexpectedly, Bet-at-home 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 Bet-at-home will offset losses from the drop in Bet-at-home's long position.Canadian Utilities vs. Iberdrola SA | Canadian Utilities vs. Enel SpA | Canadian Utilities vs. Enel SpA | Canadian Utilities vs. National Grid PLC |
Bet-at-home vs. Apple Inc | Bet-at-home vs. Apple Inc | Bet-at-home vs. Apple Inc | Bet-at-home vs. Apple Inc |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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