Correlation Between Sangoma Technologies and Bombardier

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

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

Diversification Opportunities for Sangoma Technologies and Bombardier

0.18

Correlation Coefficient

Sangoma Technologies  Bombardier

Average diversification

The 3 months correlation between Sangoma and Bombardier is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sangoma Technologies Corp and Bombardier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bombardier and Sangoma Technologies 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 Sangoma Technologies Corp are associated (or correlated) with Bombardier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bombardier has no effect on the direction of Sangoma Technologies i.e., Sangoma Technologies and Bombardier go up and down completely randomly.

Pair Corralation between Sangoma Technologies and Bombardier

Assuming the 90 days trading horizon Sangoma Technologies Corp is expected to generate 1.07 times more return on investment than Bombardier. However, Sangoma Technologies is 1.07 times more volatile than Bombardier. It trades about 0.04 of its potential returns per unit of risk. Bombardier is currently generating about 0.04 per unit of risk. If you would invest  484.00  in Sangoma Technologies Corp on December 6, 2024 and sell it today you would earn a total of  254.00  from holding Sangoma Technologies Corp or generate 52.48% return on investment over 90 days.

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

Sangoma Technologies Corp  vs.  Bombardier

Sangoma Technologies Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sangoma Technologies Corp 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 fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Bombardier

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bombardier 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 April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Sangoma Technologies and Bombardier

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

The idea behind Sangoma Technologies Corp and Bombardier 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.