Correlation Between LQwD FinTech and Canadian General

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

By analyzing existing cross correlation between LQwD FinTech Corp and Canadian General Investments, you can compare the effects of market volatilities on LQwD FinTech and Canadian General 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 LQwD FinTech with a short position of Canadian General. Check out your portfolio center. Please also check ongoing floating volatility patterns of LQwD FinTech and Canadian General.

Diversification Opportunities for LQwD FinTech and Canadian General

0.75

Correlation Coefficient

LQwD FinTech  Canadian General

Poor diversification

The 3 months correlation between LQwD and Canadian is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding LQwD FinTech Corp and Canadian General Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian General Inv and LQwD FinTech 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 LQwD FinTech Corp are associated (or correlated) with Canadian General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian General Inv has no effect on the direction of LQwD FinTech i.e., LQwD FinTech and Canadian General go up and down completely randomly.

Pair Corralation between LQwD FinTech and Canadian General

Assuming the 90 days trading horizon LQwD FinTech Corp is expected to under-perform the Canadian General. In addition to that, LQwD FinTech is 5.66 times more volatile than Canadian General Investments. It trades about -0.09 of its total potential returns per unit of risk. Canadian General Investments is currently generating about -0.11 per unit of volatility. If you would invest  4,020  in Canadian General Investments on December 30, 2024 and sell it today you would lose (409.00) from holding Canadian General Investments or give up 10.17% of portfolio value over 90 days.

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

LQwD FinTech Corp  vs.  Canadian General Investments

LQwD FinTech Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days LQwD FinTech Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Canadian General Inv

Risk-Adjusted Performance

Very Weak

Over the last 90 days Canadian General Investments has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with LQwD FinTech and Canadian General

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

The idea behind LQwD FinTech Corp and Canadian General Investments 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.