Correlation Between Armada Hflr and CIBC Equity
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and CIBC Equity 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 Armada Hflr and CIBC Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and CIBC Equity Index, you can compare the effects of market volatilities on Armada Hflr and CIBC Equity 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 Armada Hflr with a short position of CIBC Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and CIBC Equity.
Diversification Opportunities for Armada Hflr and CIBC Equity
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Armada and CIBC is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and CIBC Equity Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIBC Equity Index and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with CIBC Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIBC Equity Index has no effect on the direction of Armada Hflr i.e., Armada Hflr and CIBC Equity go up and down completely randomly.
Pair Corralation between Armada Hflr and CIBC Equity
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the CIBC Equity. In addition to that, Armada Hflr is 1.47 times more volatile than CIBC Equity Index. It trades about -0.09 of its total potential returns per unit of risk. CIBC Equity Index is currently generating about 0.27 per unit of volatility. If you would invest 3,299 in CIBC Equity Index on September 13, 2024 and sell it today you would earn a total of 114.00 from holding CIBC Equity Index or generate 3.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Armada Hflr Pr vs. CIBC Equity Index
Performance |
| Timeline |
| Armada Hflr Pr |
| CIBC Equity Index |
Armada Hflr and CIBC Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and CIBC Equity
The main advantage of trading using opposite Armada Hflr and CIBC Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, CIBC Equity 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 CIBC Equity will offset losses from the drop in CIBC Equity's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| CIBC Equity vs. CIBC Core Fixed | CIBC Equity vs. CIBC Canadian Equity | CIBC Equity vs. CIBC Clean Energy | CIBC Equity vs. CIBC Conservative Fixed |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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