Correlation Between CI Global and Brookfield
Can any of the company-specific risk be diversified away by investing in both CI Global and Brookfield 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 Global and Brookfield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Global Real and Brookfield, you can compare the effects of market volatilities on CI Global and Brookfield 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 Global with a short position of Brookfield. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Global and Brookfield.
Diversification Opportunities for CI Global and Brookfield
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CGRA and Brookfield is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding CI Global Real and Brookfield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield and CI Global 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 Global Real are associated (or correlated) with Brookfield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield has no effect on the direction of CI Global i.e., CI Global and Brookfield go up and down completely randomly.
Pair Corralation between CI Global and Brookfield
Assuming the 90 days trading horizon CI Global Real is expected to generate 1.2 times more return on investment than Brookfield. However, CI Global is 1.2 times more volatile than Brookfield. It trades about 0.13 of its potential returns per unit of risk. Brookfield is currently generating about -0.16 per unit of risk. If you would invest 2,223 in CI Global Real on December 11, 2024 and sell it today you would earn a total of 53.00 from holding CI Global Real or generate 2.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CI Global Real vs. Brookfield
Performance |
Timeline |
CI Global Real |
Brookfield |
CI Global and Brookfield Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CI Global and Brookfield
The main advantage of trading using opposite CI Global and Brookfield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Global position performs unexpectedly, Brookfield 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 Brookfield will offset losses from the drop in Brookfield's long position.CI Global vs. CI Global REIT | CI Global vs. CI Global Infrastructure | CI Global vs. CI Global Asset | CI Global vs. CI Marret Alternative |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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