Correlation Between Desjardins and CI Global
Can any of the company-specific risk be diversified away by investing in both Desjardins and CI 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 Desjardins and CI Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Desjardins RI Global and CI Global Climate, you can compare the effects of market volatilities on Desjardins and CI 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 Desjardins with a short position of CI Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Desjardins and CI Global.
Diversification Opportunities for Desjardins and CI Global
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Desjardins and CLML is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Desjardins RI Global and CI Global Climate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Global Climate and Desjardins 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 Desjardins RI Global are associated (or correlated) with CI Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Global Climate has no effect on the direction of Desjardins i.e., Desjardins and CI Global go up and down completely randomly.
Pair Corralation between Desjardins and CI Global
Assuming the 90 days trading horizon Desjardins RI Global is expected to generate 0.36 times more return on investment than CI Global. However, Desjardins RI Global is 2.78 times less risky than CI Global. It trades about 0.02 of its potential returns per unit of risk. CI Global Climate is currently generating about -0.04 per unit of risk. If you would invest 3,196 in Desjardins RI Global on December 10, 2024 and sell it today you would earn a total of 29.00 from holding Desjardins RI Global or generate 0.91% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Desjardins RI Global vs. CI Global Climate
Performance |
Timeline |
Desjardins RI Global |
CI Global Climate |
Desjardins and CI Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Desjardins and CI Global
The main advantage of trading using opposite Desjardins and CI Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Desjardins position performs unexpectedly, CI 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 CI Global will offset losses from the drop in CI Global's long position.Desjardins vs. Global X Global | Desjardins vs. Desjardins RI USA | Desjardins vs. Desjardins RI Canada | Desjardins vs. Desjardins Canadian Preferred |
CI Global vs. NBI High Yield | CI Global vs. NBI Unconstrained Fixed | CI Global vs. Mackenzie Developed ex North | CI Global vs. BMO Short Term Bond |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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