Correlation Between Primaris Retail and Rogers Communications

Can any of the company-specific risk be diversified away by investing in both Primaris Retail and Rogers Communications 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 Primaris Retail and Rogers Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Primaris Retail RE and Rogers Communications, you can compare the effects of market volatilities on Primaris Retail and Rogers Communications 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 Primaris Retail with a short position of Rogers Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Primaris Retail and Rogers Communications.

Diversification Opportunities for Primaris Retail and Rogers Communications

-0.33

Correlation Coefficient

Primaris Retail  Rogers Communications

Very good diversification

The 3 months correlation between Primaris and Rogers is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Primaris Retail RE and Rogers Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers Communications and Primaris Retail 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 Primaris Retail RE are associated (or correlated) with Rogers Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers Communications has no effect on the direction of Primaris Retail i.e., Primaris Retail and Rogers Communications go up and down completely randomly.

Pair Corralation between Primaris Retail and Rogers Communications

Assuming the 90 days trading horizon Primaris Retail RE is expected to generate 0.42 times more return on investment than Rogers Communications. However, Primaris Retail RE is 2.4 times less risky than Rogers Communications. It trades about 0.01 of its potential returns per unit of risk. Rogers Communications is currently generating about -0.26 per unit of risk. If you would invest  1,600  in Primaris Retail RE on September 19, 2024 and sell it today you would earn a total of  2.00  from holding Primaris Retail RE or generate 0.13% return on investment over 90 days.

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

Primaris Retail RE  vs.  Rogers Communications

Primaris Retail RE

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Primaris Retail RE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Primaris Retail is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Rogers Communications

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rogers Communications has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Primaris Retail and Rogers Communications

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

The idea behind Primaris Retail RE and Rogers Communications 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.