Correlation Between Brompton European and Manulife Dividend
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By analyzing existing cross correlation between Brompton European Dividend and Manulife Dividend Income, you can compare the effects of market volatilities on Brompton European 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 Brompton European with a short position of Manulife Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brompton European and Manulife Dividend.
Diversification Opportunities for Brompton European and Manulife Dividend
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Brompton and Manulife is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Brompton European Dividend 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 Brompton European 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 Brompton European Dividend 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 Brompton European i.e., Brompton European and Manulife Dividend go up and down completely randomly.
Pair Corralation between Brompton European and Manulife Dividend
Assuming the 90 days trading horizon Brompton European Dividend is expected to generate 1.26 times more return on investment than Manulife Dividend. However, Brompton European is 1.26 times more volatile than Manulife Dividend Income. It trades about 0.04 of its potential returns per unit of risk. Manulife Dividend Income is currently generating about 0.02 per unit of risk. If you would invest 892.00 in Brompton European Dividend on October 10, 2024 and sell it today you would earn a total of 153.00 from holding Brompton European Dividend or generate 17.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Brompton European Dividend vs. Manulife Dividend Income
Performance |
Timeline |
Brompton European |
Manulife Dividend Income |
Brompton European and Manulife Dividend Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Brompton European and Manulife Dividend
The main advantage of trading using opposite Brompton European and Manulife Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brompton European 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.Brompton European vs. Brompton Global Dividend | Brompton European vs. Global Healthcare Income | Brompton European vs. Tech Leaders Income | Brompton European vs. Brompton North American |
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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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