Correlation Between Manulife Multifactor and Evolve Cyber
Can any of the company-specific risk be diversified away by investing in both Manulife Multifactor and Evolve Cyber 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 Evolve Cyber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Multifactor Large and Evolve Cyber Security, you can compare the effects of market volatilities on Manulife Multifactor and Evolve Cyber 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 Evolve Cyber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Multifactor and Evolve Cyber.
Diversification Opportunities for Manulife Multifactor and Evolve Cyber
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Manulife and Evolve is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Multifactor Large and Evolve Cyber Security in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolve Cyber Security 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 Large are associated (or correlated) with Evolve Cyber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolve Cyber Security has no effect on the direction of Manulife Multifactor i.e., Manulife Multifactor and Evolve Cyber go up and down completely randomly.
Pair Corralation between Manulife Multifactor and Evolve Cyber
Assuming the 90 days trading horizon Manulife Multifactor Large is expected to under-perform the Evolve Cyber. But the etf apears to be less risky and, when comparing its historical volatility, Manulife Multifactor Large is 2.11 times less risky than Evolve Cyber. The etf trades about -0.12 of its potential returns per unit of risk. The Evolve Cyber Security is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 6,252 in Evolve Cyber Security on September 26, 2024 and sell it today you would lose (47.00) from holding Evolve Cyber Security or give up 0.75% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.65% |
Values | Daily Returns |
Manulife Multifactor Large vs. Evolve Cyber Security
Performance |
Timeline |
Manulife Multifactor |
Evolve Cyber Security |
Manulife Multifactor and Evolve Cyber Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Manulife Multifactor and Evolve Cyber
The main advantage of trading using opposite Manulife Multifactor and Evolve Cyber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Multifactor position performs unexpectedly, Evolve Cyber 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 Evolve Cyber will offset losses from the drop in Evolve Cyber's long position.Manulife Multifactor vs. Vanguard SP 500 | Manulife Multifactor vs. Vanguard FTSE Canadian | Manulife Multifactor vs. iShares NASDAQ 100 | Manulife Multifactor vs. Vanguard Total Market |
Evolve Cyber vs. Manulife Multifactor Mid | Evolve Cyber vs. Manulife Multifactor Canadian | Evolve Cyber vs. Manulife Multifactor Large | Evolve Cyber 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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