Correlation Between Savaria and Magellan Aerospace
Can any of the company-specific risk be diversified away by investing in both Savaria and Magellan Aerospace 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 Savaria and Magellan Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Savaria and Magellan Aerospace, you can compare the effects of market volatilities on Savaria and Magellan Aerospace 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 Savaria with a short position of Magellan Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Savaria and Magellan Aerospace.
Diversification Opportunities for Savaria and Magellan Aerospace
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Savaria and Magellan is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Savaria and Magellan Aerospace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magellan Aerospace and Savaria 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 Savaria are associated (or correlated) with Magellan Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magellan Aerospace has no effect on the direction of Savaria i.e., Savaria and Magellan Aerospace go up and down completely randomly.
Pair Corralation between Savaria and Magellan Aerospace
Assuming the 90 days trading horizon Savaria is expected to generate 6.56 times less return on investment than Magellan Aerospace. But when comparing it to its historical volatility, Savaria is 1.9 times less risky than Magellan Aerospace. It trades about 0.02 of its potential returns per unit of risk. Magellan Aerospace is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,579 in Magellan Aerospace on August 22, 2025 and sell it today you would earn a total of 116.00 from holding Magellan Aerospace or generate 7.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Savaria vs. Magellan Aerospace
Performance |
| Timeline |
| Savaria |
| Magellan Aerospace |
Savaria and Magellan Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Savaria and Magellan Aerospace
The main advantage of trading using opposite Savaria and Magellan Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Savaria position performs unexpectedly, Magellan Aerospace 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 Magellan Aerospace will offset losses from the drop in Magellan Aerospace's long position.| Savaria vs. Ballard Power Systems | Savaria vs. Westshore Terminals Investment | Savaria vs. Bird Construction | Savaria vs. Transcontinental |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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