Correlation Between GreenFirst Forest and Altagas Cum

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

By analyzing existing cross correlation between GreenFirst Forest Products and Altagas Cum Red, you can compare the effects of market volatilities on GreenFirst Forest and Altagas Cum 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 GreenFirst Forest with a short position of Altagas Cum. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenFirst Forest and Altagas Cum.

Diversification Opportunities for GreenFirst Forest and Altagas Cum

-0.59

Correlation Coefficient

GreenFirst Forest  Altagas Cum

Excellent diversification

The 3 months correlation between GreenFirst and Altagas is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding GreenFirst Forest Products and Altagas Cum Red in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altagas Cum Red and GreenFirst Forest 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 GreenFirst Forest Products are associated (or correlated) with Altagas Cum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altagas Cum Red has no effect on the direction of GreenFirst Forest i.e., GreenFirst Forest and Altagas Cum go up and down completely randomly.

Pair Corralation between GreenFirst Forest and Altagas Cum

Assuming the 90 days horizon GreenFirst Forest Products is expected to under-perform the Altagas Cum. In addition to that, GreenFirst Forest is 3.96 times more volatile than Altagas Cum Red. It trades about -0.21 of its total potential returns per unit of risk. Altagas Cum Red is currently generating about 0.35 per unit of volatility. If you would invest  1,859  in Altagas Cum Red on October 23, 2024 and sell it today you would earn a total of  302.00  from holding Altagas Cum Red or generate 16.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

GreenFirst Forest Products  vs.  Altagas Cum Red

GreenFirst Forest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GreenFirst Forest Products has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Altagas Cum Red

Risk-Adjusted Performance

27 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Altagas Cum Red are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Altagas Cum sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GreenFirst Forest and Altagas Cum

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

The idea behind GreenFirst Forest Products and Altagas Cum Red 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.