Correlation Between Dividend Growth and North American
Can any of the company-specific risk be diversified away by investing in both Dividend Growth and North American 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 Dividend Growth and North American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dividend Growth Split and North American Financial, you can compare the effects of market volatilities on Dividend Growth and North American 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 Dividend Growth with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dividend Growth and North American.
Diversification Opportunities for Dividend Growth and North American
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dividend and North is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Dividend Growth Split and North American Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Financial and Dividend Growth 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 Dividend Growth Split are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Financial has no effect on the direction of Dividend Growth i.e., Dividend Growth and North American go up and down completely randomly.
Pair Corralation between Dividend Growth and North American
Assuming the 90 days trading horizon Dividend Growth is expected to generate 3.57 times less return on investment than North American. But when comparing it to its historical volatility, Dividend Growth Split is 1.64 times less risky than North American. It trades about 0.16 of its potential returns per unit of risk. North American Financial is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 728.00 in North American Financial on September 12, 2025 and sell it today you would earn a total of 174.00 from holding North American Financial or generate 23.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dividend Growth Split vs. North American Financial
Performance |
| Timeline |
| Dividend Growth Split |
| North American Financial |
Dividend Growth and North American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dividend Growth and North American
The main advantage of trading using opposite Dividend Growth and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dividend Growth position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.| Dividend Growth vs. Brompton Split Banc | Dividend Growth vs. Urbana | Dividend Growth vs. Urbana | Dividend Growth vs. North American Financial |
| North American vs. Life Banc Split | North American vs. Dividend Growth Split | North American vs. Queens Road Capital | North American vs. Canadian Banc Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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