Correlation Between CAE and TFI International
Can any of the company-specific risk be diversified away by investing in both CAE and TFI International 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 CAE and TFI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CAE Inc and TFI International, you can compare the effects of market volatilities on CAE and TFI International 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 CAE with a short position of TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAE and TFI International.
Diversification Opportunities for CAE and TFI International
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CAE and TFI is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding CAE Inc and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International and CAE 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 CAE Inc are associated (or correlated) with TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of CAE i.e., CAE and TFI International go up and down completely randomly.
Pair Corralation between CAE and TFI International
Assuming the 90 days trading horizon CAE is expected to generate 1.37 times less return on investment than TFI International. But when comparing it to its historical volatility, CAE Inc is 1.54 times less risky than TFI International. It trades about 0.06 of its potential returns per unit of risk. TFI International is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 13,040 in TFI International on September 11, 2025 and sell it today you would earn a total of 906.00 from holding TFI International or generate 6.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CAE Inc vs. TFI International
Performance |
| Timeline |
| CAE Inc |
| TFI International |
CAE and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAE and TFI International
The main advantage of trading using opposite CAE and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAE position performs unexpectedly, TFI International 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 TFI International will offset losses from the drop in TFI International's long position.| CAE vs. Toromont Industries | CAE vs. Bombardier Pref B | CAE vs. Element Fleet Management | CAE vs. TFI International |
| TFI International vs. Finning International | TFI International vs. CAE Inc | TFI International vs. South Bow | TFI International vs. Bombardier Pref B |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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