Correlation Between Laurentian Bank and Computer Modelling
Can any of the company-specific risk be diversified away by investing in both Laurentian Bank and Computer Modelling 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 Laurentian Bank and Computer Modelling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Laurentian Bank and Computer Modelling Group, you can compare the effects of market volatilities on Laurentian Bank and Computer Modelling 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 Laurentian Bank with a short position of Computer Modelling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Laurentian Bank and Computer Modelling.
Diversification Opportunities for Laurentian Bank and Computer Modelling
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Laurentian and Computer is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Laurentian Bank and Computer Modelling Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Modelling and Laurentian Bank 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 Laurentian Bank are associated (or correlated) with Computer Modelling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Modelling has no effect on the direction of Laurentian Bank i.e., Laurentian Bank and Computer Modelling go up and down completely randomly.
Pair Corralation between Laurentian Bank and Computer Modelling
Assuming the 90 days horizon Laurentian Bank is expected to generate 0.36 times more return on investment than Computer Modelling. However, Laurentian Bank is 2.79 times less risky than Computer Modelling. It trades about 0.1 of its potential returns per unit of risk. Computer Modelling Group is currently generating about -0.16 per unit of risk. If you would invest 3,042 in Laurentian Bank on July 27, 2025 and sell it today you would earn a total of 211.00 from holding Laurentian Bank or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Laurentian Bank vs. Computer Modelling Group
Performance |
| Timeline |
| Laurentian Bank |
| Computer Modelling |
Laurentian Bank and Computer Modelling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Laurentian Bank and Computer Modelling
The main advantage of trading using opposite Laurentian Bank and Computer Modelling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Laurentian Bank position performs unexpectedly, Computer Modelling 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 Computer Modelling will offset losses from the drop in Computer Modelling's long position.| Laurentian Bank vs. Guardian Capital Group | Laurentian Bank vs. Guardian Capital Group | Laurentian Bank vs. Uniteds Limited | Laurentian Bank vs. Alignvest Acquisition II |
| Computer Modelling vs. TECSYS Inc | Computer Modelling vs. Real Matters | Computer Modelling vs. Dye Durham | Computer Modelling vs. Drone Delivery Canada |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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