Correlation Between Timbercreek Financial and CI Financial
Can any of the company-specific risk be diversified away by investing in both Timbercreek Financial and CI Financial 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 Timbercreek Financial and CI Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timbercreek Financial Corp and CI Financial Corp, you can compare the effects of market volatilities on Timbercreek Financial and CI Financial 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 Timbercreek Financial with a short position of CI Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timbercreek Financial and CI Financial.
Diversification Opportunities for Timbercreek Financial and CI Financial
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Timbercreek and CIX is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Timbercreek Financial Corp and CI Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Financial Corp and Timbercreek 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 Timbercreek Financial Corp are associated (or correlated) with CI Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Financial Corp has no effect on the direction of Timbercreek Financial i.e., Timbercreek Financial and CI Financial go up and down completely randomly.
Pair Corralation between Timbercreek Financial and CI Financial
Assuming the 90 days horizon Timbercreek Financial Corp is expected to under-perform the CI Financial. In addition to that, Timbercreek Financial is 4.69 times more volatile than CI Financial Corp. It trades about -0.17 of its total potential returns per unit of risk. CI Financial Corp is currently generating about 0.12 per unit of volatility. If you would invest 3,084 in CI Financial Corp on December 1, 2024 and sell it today you would earn a total of 54.00 from holding CI Financial Corp or generate 1.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Timbercreek Financial Corp vs. CI Financial Corp
Performance |
Timeline |
Timbercreek Financial |
CI Financial Corp |
Timbercreek Financial and CI Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Timbercreek Financial and CI Financial
The main advantage of trading using opposite Timbercreek Financial and CI Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timbercreek Financial position performs unexpectedly, CI Financial 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 CI Financial will offset losses from the drop in CI Financial's long position.Timbercreek Financial vs. Atrium Mortgage Investment | Timbercreek Financial vs. MCAN Mortgage | Timbercreek Financial vs. Fiera Capital | Timbercreek Financial vs. Firm Capital Mortgage |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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