Correlation Between EcoSynthetix and Manulife Dividend

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

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

Diversification Opportunities for EcoSynthetix and Manulife Dividend

-0.58

Correlation Coefficient

EcoSynthetix  Manulife Dividend

Excellent diversification

The 3 months correlation between EcoSynthetix and Manulife is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding EcoSynthetix and Manulife Dividend Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Dividend Income and EcoSynthetix 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 EcoSynthetix are associated (or correlated) with Manulife Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Dividend Income has no effect on the direction of EcoSynthetix i.e., EcoSynthetix and Manulife Dividend go up and down completely randomly.

Pair Corralation between EcoSynthetix and Manulife Dividend

Assuming the 90 days trading horizon EcoSynthetix is expected to generate 1.49 times more return on investment than Manulife Dividend. However, EcoSynthetix is 1.49 times more volatile than Manulife Dividend Income. It trades about -0.01 of its potential returns per unit of risk. Manulife Dividend Income is currently generating about -0.09 per unit of risk. If you would invest  429.00  in EcoSynthetix on October 25, 2024 and sell it today you would lose (9.00) from holding EcoSynthetix or give up 2.1% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

EcoSynthetix  vs.  Manulife Dividend Income

EcoSynthetix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EcoSynthetix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, EcoSynthetix is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Manulife Dividend Income

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Manulife Dividend Income has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest uncertain performance, the Fund's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the fund sophisticated investors.

Pair Trading with EcoSynthetix and Manulife Dividend

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

The idea behind EcoSynthetix and Manulife Dividend Income 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.