Correlation Between Onex Corp and Dundee
Can any of the company-specific risk be diversified away by investing in both Onex Corp and Dundee 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 Onex Corp and Dundee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Onex Corp and Dundee, you can compare the effects of market volatilities on Onex Corp and Dundee 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 Onex Corp with a short position of Dundee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Onex Corp and Dundee.
Diversification Opportunities for Onex Corp and Dundee
Excellent diversification
The 3 months correlation between Onex and Dundee is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Onex Corp and Dundee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dundee and Onex Corp 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 Onex Corp are associated (or correlated) with Dundee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dundee has no effect on the direction of Onex Corp i.e., Onex Corp and Dundee go up and down completely randomly.
Pair Corralation between Onex Corp and Dundee
Assuming the 90 days trading horizon Onex Corp is expected to under-perform the Dundee. But the stock apears to be less risky and, when comparing its historical volatility, Onex Corp is 6.11 times less risky than Dundee. The stock trades about -0.08 of its potential returns per unit of risk. The Dundee is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 101.00 in Dundee on January 26, 2024 and sell it today you would earn a total of 26.00 from holding Dundee or generate 25.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Onex Corp vs. Dundee
Performance |
| Timeline |
| Onex Corp |
| Dundee |
Onex Corp and Dundee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Onex Corp and Dundee
The main advantage of trading using opposite Onex Corp and Dundee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Onex Corp position performs unexpectedly, Dundee 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 Dundee will offset losses from the drop in Dundee's long position.| Onex Corp vs. Element Fleet Management | Onex Corp vs. Martinrea International | Onex Corp vs. Mullen Group |
| Dundee vs. Gamehost | Dundee vs. Andrew Peller Limited | Dundee vs. Buhler Industries | Dundee vs. Accord Financial 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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