Correlation Between Intact Financial and Micron Technology,

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

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

Diversification Opportunities for Intact Financial and Micron Technology,

0.06

Correlation Coefficient

Intact Financial  Micron Technology,

Significant diversification

The 3 months correlation between Intact and Micron is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Intact Financial Corp and Micron Technology, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micron Technology, and Intact Financial 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 Intact Financial Corp are associated (or correlated) with Micron Technology,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Micron Technology, has no effect on the direction of Intact Financial i.e., Intact Financial and Micron Technology, go up and down completely randomly.

Pair Corralation between Intact Financial and Micron Technology,

Assuming the 90 days trading horizon Intact Financial is expected to generate 12.47 times less return on investment than Micron Technology,. But when comparing it to its historical volatility, Intact Financial Corp is 7.6 times less risky than Micron Technology,. It trades about 0.16 of its potential returns per unit of risk. Micron Technology, is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  2,031  in Micron Technology, on October 26, 2024 and sell it today you would earn a total of  369.00  from holding Micron Technology, or generate 18.17% return on investment over 90 days.

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

Intact Financial Corp  vs.  Micron Technology,

Intact Financial Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Intact Financial Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Intact Financial is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Micron Technology,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micron Technology, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Micron Technology, is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Intact Financial and Micron Technology,

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

The idea behind Intact Financial Corp and Micron Technology, 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.

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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.