Correlation Between Manulife Multifactor and Purpose Floating
Can any of the company-specific risk be diversified away by investing in both Manulife Multifactor and Purpose Floating 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 Manulife Multifactor and Purpose Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Multifactor Canadian and Purpose Floating Rate, you can compare the effects of market volatilities on Manulife Multifactor and Purpose Floating 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 Manulife Multifactor with a short position of Purpose Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Multifactor and Purpose Floating.
Diversification Opportunities for Manulife Multifactor and Purpose Floating
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Manulife and Purpose is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Multifactor Canadian and Purpose Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Purpose Floating Rate and Manulife Multifactor 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 Manulife Multifactor Canadian are associated (or correlated) with Purpose Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Purpose Floating Rate has no effect on the direction of Manulife Multifactor i.e., Manulife Multifactor and Purpose Floating go up and down completely randomly.
Pair Corralation between Manulife Multifactor and Purpose Floating
Assuming the 90 days trading horizon Manulife Multifactor Canadian is expected to under-perform the Purpose Floating. But the etf apears to be less risky and, when comparing its historical volatility, Manulife Multifactor Canadian is 1.29 times less risky than Purpose Floating. The etf trades about -0.16 of its potential returns per unit of risk. The Purpose Floating Rate is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 612.00 in Purpose Floating Rate on September 26, 2024 and sell it today you would earn a total of 12.00 from holding Purpose Floating Rate or generate 1.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Manulife Multifactor Canadian vs. Purpose Floating Rate
Performance |
Timeline |
Manulife Multifactor |
Purpose Floating Rate |
Manulife Multifactor and Purpose Floating Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Manulife Multifactor and Purpose Floating
The main advantage of trading using opposite Manulife Multifactor and Purpose Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Multifactor position performs unexpectedly, Purpose Floating 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 Purpose Floating will offset losses from the drop in Purpose Floating's long position.Manulife Multifactor vs. iShares ESG Aware | Manulife Multifactor vs. iShares Core Canadian | Manulife Multifactor vs. Vanguard Global Momentum | Manulife Multifactor vs. iShares SP Global |
Purpose Floating vs. Manulife Multifactor Mid | Purpose Floating vs. Manulife Multifactor Canadian | Purpose Floating vs. Manulife Multifactor Large | Purpose Floating vs. Manulife Multifactor Canadian |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
CEOs Directory Screen CEOs from public companies around the world | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |