Correlation Between Fiera Capital and ROKMASTER Resources

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

By analyzing existing cross correlation between Fiera Capital and ROKMASTER Resources Corp, you can compare the effects of market volatilities on Fiera Capital and ROKMASTER Resources 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 Fiera Capital with a short position of ROKMASTER Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiera Capital and ROKMASTER Resources.

Diversification Opportunities for Fiera Capital and ROKMASTER Resources

-0.14

Correlation Coefficient

Fiera Capital  ROKMASTER Resources

Good diversification

The 3 months correlation between Fiera and ROKMASTER is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Fiera Capital and ROKMASTER Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROKMASTER Resources Corp and Fiera Capital 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 Fiera Capital are associated (or correlated) with ROKMASTER Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROKMASTER Resources Corp has no effect on the direction of Fiera Capital i.e., Fiera Capital and ROKMASTER Resources go up and down completely randomly.

Pair Corralation between Fiera Capital and ROKMASTER Resources

Assuming the 90 days trading horizon Fiera Capital is expected to generate 3.36 times less return on investment than ROKMASTER Resources. But when comparing it to its historical volatility, Fiera Capital is 6.15 times less risky than ROKMASTER Resources. It trades about 0.07 of its potential returns per unit of risk. ROKMASTER Resources Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  5.00  in ROKMASTER Resources Corp on October 2, 2024 and sell it today you would lose (3.00) from holding ROKMASTER Resources Corp or give up 60.0% of portfolio value over 90 days.

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

Fiera Capital  vs.  ROKMASTER Resources Corp

Fiera Capital

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fiera Capital are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Fiera Capital may actually be approaching a critical reversion point that can send shares even higher in January 2025.

ROKMASTER Resources Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ROKMASTER Resources Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, ROKMASTER Resources showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fiera Capital and ROKMASTER Resources

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

The idea behind Fiera Capital and ROKMASTER Resources Corp 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.