Correlation Between BetaPro Canadian and Global Dividend

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

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

Diversification Opportunities for BetaPro Canadian and Global Dividend

-0.37

Correlation Coefficient

BetaPro Canadian  Global Dividend

Very good diversification

The 3 months correlation between BetaPro and Global is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro Canadian Gold and Global Dividend Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Dividend Growth and BetaPro Canadian 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 BetaPro Canadian Gold are associated (or correlated) with Global Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Dividend Growth has no effect on the direction of BetaPro Canadian i.e., BetaPro Canadian and Global Dividend go up and down completely randomly.

Pair Corralation between BetaPro Canadian and Global Dividend

Assuming the 90 days trading horizon BetaPro Canadian Gold is expected to generate 2.54 times more return on investment than Global Dividend. However, BetaPro Canadian is 2.54 times more volatile than Global Dividend Growth. It trades about 0.16 of its potential returns per unit of risk. Global Dividend Growth is currently generating about -0.08 per unit of risk. If you would invest  2,133  in BetaPro Canadian Gold on October 25, 2024 and sell it today you would earn a total of  230.00  from holding BetaPro Canadian Gold or generate 10.78% return on investment over 90 days.

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

BetaPro Canadian Gold  vs.  Global Dividend Growth

BetaPro Canadian Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BetaPro Canadian Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Global Dividend Growth

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Global Dividend Growth are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Global Dividend is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with BetaPro Canadian and Global Dividend

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

The idea behind BetaPro Canadian Gold and Global Dividend Growth 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.