Correlation Between RBC Select and Capital Group
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By analyzing existing cross correlation between RBC Select Balanced and Capital Group Global, you can compare the effects of market volatilities on RBC Select and Capital Group 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 RBC Select with a short position of Capital Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBC Select and Capital Group.
Diversification Opportunities for RBC Select and Capital Group
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between RBC and Capital is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding RBC Select Balanced and Capital Group Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Group Global and RBC Select 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 RBC Select Balanced are associated (or correlated) with Capital Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Group Global has no effect on the direction of RBC Select i.e., RBC Select and Capital Group go up and down completely randomly.
Pair Corralation between RBC Select and Capital Group
Assuming the 90 days trading horizon RBC Select is expected to generate 1.65 times less return on investment than Capital Group. But when comparing it to its historical volatility, RBC Select Balanced is 2.28 times less risky than Capital Group. It trades about 0.14 of its potential returns per unit of risk. Capital Group Global is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 6,020 in Capital Group Global on August 30, 2024 and sell it today you would earn a total of 101.00 from holding Capital Group Global or generate 1.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
RBC Select Balanced vs. Capital Group Global
Performance |
| Timeline |
| RBC Select Balanced |
| Capital Group Global |
RBC Select and Capital Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RBC Select and Capital Group
The main advantage of trading using opposite RBC Select and Capital Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RBC Select position performs unexpectedly, Capital Group 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 Capital Group will offset losses from the drop in Capital Group's long position.| RBC Select vs. TD Comfort Balanced | RBC Select vs. Mawer Balanced | RBC Select vs. iShares Canadian HYBrid | RBC Select vs. Altagas Cum Red |
| Capital Group vs. Fidelity Tactical High | Capital Group vs. Fidelity ClearPath 2045 | Capital Group vs. Bloom Select Income | Capital Group vs. Global Healthcare Income |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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