Correlation Between Power and FirstService Corp

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

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

Diversification Opportunities for Power and FirstService Corp

-0.91

Correlation Coefficient

Power  FirstService Corp

Pay attention - limited upside

The 3 months correlation between Power and FirstService is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Power and FirstService Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FirstService Corp and Power 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 Power are associated (or correlated) with FirstService Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FirstService Corp has no effect on the direction of Power i.e., Power and FirstService Corp go up and down completely randomly.

Pair Corralation between Power and FirstService Corp

Assuming the 90 days trading horizon Power is expected to generate 0.54 times more return on investment than FirstService Corp. However, Power is 1.87 times less risky than FirstService Corp. It trades about 0.38 of its potential returns per unit of risk. FirstService Corp is currently generating about -0.18 per unit of risk. If you would invest  5,917  in Power on September 27, 2025 and sell it today you would earn a total of  1,429  from holding Power or generate 24.15% return on investment over 90 days.

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

Power  vs.  FirstService Corp

Power

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Power are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Power displayed solid returns over the last few months and may actually be approaching a breakup point.

FirstService Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days FirstService Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2026. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Power and FirstService Corp

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

The idea behind Power and FirstService Corp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.