Correlation Between Flaherty Crumrine and IShares Core

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

By analyzing existing cross correlation between Flaherty Crumrine Investment and iShares Core Canadian, you can compare the effects of market volatilities on Flaherty Crumrine and IShares Core 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 Flaherty Crumrine with a short position of IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flaherty Crumrine and IShares Core.

Diversification Opportunities for Flaherty Crumrine and IShares Core

0.0

Correlation Coefficient

Flaherty Crumrine  IShares Core

Pay attention - limited upside

The 3 months correlation between Flaherty and IShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Flaherty Crumrine Investment and iShares Core Canadian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Canadian and Flaherty Crumrine 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 Flaherty Crumrine Investment are associated (or correlated) with IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Canadian has no effect on the direction of Flaherty Crumrine i.e., Flaherty Crumrine and IShares Core go up and down completely randomly.

Pair Corralation between Flaherty Crumrine and IShares Core

If you would invest  1,999  in iShares Core Canadian on September 26, 2024 and sell it today you would earn a total of  18.00  from holding iShares Core Canadian or generate 0.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Flaherty Crumrine Investment  vs.  iShares Core Canadian

Flaherty Crumrine

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Flaherty Crumrine Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Flaherty Crumrine is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

iShares Core Canadian

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Core Canadian are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental drivers, IShares Core is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Flaherty Crumrine and IShares Core

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

The idea behind Flaherty Crumrine Investment and iShares Core Canadian 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.