Correlation Between SFL and Canada Goose

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

By analyzing existing cross correlation between SFL Corporation and Canada Goose Holdings, you can compare the effects of market volatilities on SFL and Canada Goose 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 SFL with a short position of Canada Goose. Check out your portfolio center. Please also check ongoing floating volatility patterns of SFL and Canada Goose.

Diversification Opportunities for SFL and Canada Goose

-0.06

Correlation Coefficient

SFL  Canada Goose

Good diversification

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

Pair Corralation between SFL and Canada Goose

Considering the 90-day investment horizon SFL Corporation is expected to generate 0.56 times more return on investment than Canada Goose. However, SFL Corporation is 1.79 times less risky than Canada Goose. It trades about 0.02 of its potential returns per unit of risk. Canada Goose Holdings is currently generating about -0.03 per unit of risk. If you would invest  803.00  in SFL Corporation on December 4, 2024 and sell it today you would earn a total of  74.00  from holding SFL Corporation or generate 9.22% return on investment over 90 days.

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

SFL Corp.  vs.  Canada Goose Holdings

SFL Corporation

Risk-Adjusted Performance

Very Weak

Over the last 90 days SFL Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Canada Goose Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Canada Goose Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Canada Goose is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SFL and Canada Goose

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

The idea behind SFL Corporation and Canada Goose Holdings 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.