Correlation Between Mawer Global and BMO Aggregate
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By analyzing existing cross correlation between Mawer Global Small and BMO Aggregate Bond, you can compare the effects of market volatilities on Mawer Global and BMO Aggregate 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 Mawer Global with a short position of BMO Aggregate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mawer Global and BMO Aggregate.
Diversification Opportunities for Mawer Global and BMO Aggregate
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mawer and BMO is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Mawer Global Small and BMO Aggregate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Aggregate Bond and Mawer Global 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 Mawer Global Small are associated (or correlated) with BMO Aggregate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Aggregate Bond has no effect on the direction of Mawer Global i.e., Mawer Global and BMO Aggregate go up and down completely randomly.
Pair Corralation between Mawer Global and BMO Aggregate
Assuming the 90 days trading horizon Mawer Global Small is expected to generate 2.75 times more return on investment than BMO Aggregate. However, Mawer Global is 2.75 times more volatile than BMO Aggregate Bond. It trades about 0.07 of its potential returns per unit of risk. BMO Aggregate Bond is currently generating about 0.13 per unit of risk. If you would invest 1,536 in Mawer Global Small on September 1, 2024 and sell it today you would earn a total of 15.00 from holding Mawer Global Small or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Mawer Global Small vs. BMO Aggregate Bond
Performance |
| Timeline |
| Mawer Global Small |
| BMO Aggregate Bond |
Mawer Global and BMO Aggregate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mawer Global and BMO Aggregate
The main advantage of trading using opposite Mawer Global and BMO Aggregate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mawer Global position performs unexpectedly, BMO Aggregate 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 BMO Aggregate will offset losses from the drop in BMO Aggregate's long position.| Mawer Global vs. BMO Aggregate Bond | Mawer Global vs. iShares Canadian HYBrid | Mawer Global vs. Brompton European Dividend | Mawer Global vs. Solar Alliance Energy |
| BMO Aggregate vs. BMO Short Term Bond | BMO Aggregate vs. BMO Canadian Bank | BMO Aggregate vs. BMO Aggregate Bond | BMO Aggregate vs. BMO Balanced ETF |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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