Correlation Between CI Signature and Mawer Global

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

By analyzing existing cross correlation between CI Signature Cat and Mawer Global Small, you can compare the effects of market volatilities on CI Signature and Mawer Global 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 CI Signature with a short position of Mawer Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Signature and Mawer Global.

Diversification Opportunities for CI Signature and Mawer Global

0.12

Correlation Coefficient

CI Signature  Mawer Global

Average diversification

The 3 months correlation between 0P0001FKWD and Mawer is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding CI Signature Cat and Mawer Global Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mawer Global Small and CI Signature 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 CI Signature Cat are associated (or correlated) with Mawer Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mawer Global Small has no effect on the direction of CI Signature i.e., CI Signature and Mawer Global go up and down completely randomly.

Pair Corralation between CI Signature and Mawer Global

If you would invest  1,519  in Mawer Global Small on October 25, 2024 and sell it today you would earn a total of  62.00  from holding Mawer Global Small or generate 4.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	0.2%
Values	Daily Returns

CI Signature Cat  vs.  Mawer Global Small

CI Signature Cat

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days CI Signature Cat has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly weak technical and fundamental indicators, CI Signature reported solid returns over the last few months and may actually be approaching a breakup point.

Mawer Global Small

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mawer Global Small has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Mawer Global is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with CI Signature and Mawer Global

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

The idea behind CI Signature Cat and Mawer Global Small 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.

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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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.