Correlation Between Intact Financial and Dexterra

Can any of the company-specific risk be diversified away by investing in both Intact Financial and Dexterra 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 Intact Financial and Dexterra into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intact Financial and Dexterra Group, you can compare the effects of market volatilities on Intact Financial and Dexterra 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 Intact Financial with a short position of Dexterra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intact Financial and Dexterra.

Diversification Opportunities for Intact Financial and Dexterra

-0.69

Correlation Coefficient

Intact Financial  Dexterra

Excellent diversification

The 3 months correlation between Intact and Dexterra is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Intact Financial and Dexterra Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dexterra Group and Intact Financial 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 Intact Financial are associated (or correlated) with Dexterra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dexterra Group has no effect on the direction of Intact Financial i.e., Intact Financial and Dexterra go up and down completely randomly.

Pair Corralation between Intact Financial and Dexterra

Assuming the 90 days trading horizon Intact Financial is expected to under-perform the Dexterra. In addition to that, Intact Financial is 1.03 times more volatile than Dexterra Group. It trades about -0.1 of its total potential returns per unit of risk. Dexterra Group is currently generating about 0.22 per unit of volatility. If you would invest  865.00  in Dexterra Group on May 26, 2025 and sell it today you would earn a total of  150.00  from holding Dexterra Group or generate 17.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Intact Financial  vs.  Dexterra Group

Intact Financial

Risk-Adjusted Performance

Weakest

Over the last 90 days Intact Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Dexterra Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Dexterra Group are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Dexterra displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intact Financial and Dexterra

The main advantage of trading using opposite Intact Financial and Dexterra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intact Financial position performs unexpectedly, Dexterra 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 Dexterra will offset losses from the drop in Dexterra's long position.

The idea behind Intact Financial and Dexterra Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.