Correlation Between BetaPro NASDAQ and CI Canadian
Can any of the company-specific risk be diversified away by investing in both BetaPro NASDAQ and CI Canadian 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 NASDAQ and CI Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BetaPro NASDAQ 100 2x and CI Canadian Short Term, you can compare the effects of market volatilities on BetaPro NASDAQ and CI Canadian 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 NASDAQ with a short position of CI Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro NASDAQ and CI Canadian.
Diversification Opportunities for BetaPro NASDAQ and CI Canadian
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BetaPro and CAGS is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro NASDAQ 100 2x and CI Canadian Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Canadian Short and BetaPro NASDAQ 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 NASDAQ 100 2x are associated (or correlated) with CI Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Canadian Short has no effect on the direction of BetaPro NASDAQ i.e., BetaPro NASDAQ and CI Canadian go up and down completely randomly.
Pair Corralation between BetaPro NASDAQ and CI Canadian
Assuming the 90 days trading horizon BetaPro NASDAQ 100 2x is expected to generate 85.89 times more return on investment than CI Canadian. However, BetaPro NASDAQ is 85.89 times more volatile than CI Canadian Short Term. It trades about 0.03 of its potential returns per unit of risk. CI Canadian Short Term is currently generating about 0.12 per unit of risk. If you would invest 833.00 in BetaPro NASDAQ 100 2x on October 4, 2024 and sell it today you would earn a total of 212.00 from holding BetaPro NASDAQ 100 2x or generate 25.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
BetaPro NASDAQ 100 2x vs. CI Canadian Short Term
Performance |
Timeline |
BetaPro NASDAQ 100 |
CI Canadian Short |
BetaPro NASDAQ and CI Canadian Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BetaPro NASDAQ and CI Canadian
The main advantage of trading using opposite BetaPro NASDAQ and CI Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaPro NASDAQ position performs unexpectedly, CI Canadian 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 Canadian will offset losses from the drop in CI Canadian's long position.BetaPro NASDAQ vs. Forstrong Global Income | BetaPro NASDAQ vs. BMO Aggregate Bond | BetaPro NASDAQ vs. iShares Canadian HYBrid | BetaPro NASDAQ vs. Solar Alliance Energy |
CI Canadian vs. NBI High Yield | CI Canadian vs. NBI Unconstrained Fixed | CI Canadian vs. Mackenzie Developed ex North | CI Canadian 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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