Correlation Between Bloom Select and Picton Mahoney
Can any of the company-specific risk be diversified away by investing in both Bloom Select and Picton Mahoney 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 Bloom Select and Picton Mahoney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloom Select Income and Picton Mahoney Fortified, you can compare the effects of market volatilities on Bloom Select and Picton Mahoney 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 Bloom Select with a short position of Picton Mahoney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Select and Picton Mahoney.
Diversification Opportunities for Bloom Select and Picton Mahoney
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bloom and Picton is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Select Income and Picton Mahoney Fortified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Picton Mahoney Fortified and Bloom 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 Bloom Select Income are associated (or correlated) with Picton Mahoney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Picton Mahoney Fortified has no effect on the direction of Bloom Select i.e., Bloom Select and Picton Mahoney go up and down completely randomly.
Pair Corralation between Bloom Select and Picton Mahoney
Assuming the 90 days trading horizon Bloom Select Income is expected to under-perform the Picton Mahoney. In addition to that, Bloom Select is 9.93 times more volatile than Picton Mahoney Fortified. It trades about -0.03 of its total potential returns per unit of risk. Picton Mahoney Fortified is currently generating about 0.3 per unit of volatility. If you would invest 1,000.00 in Picton Mahoney Fortified on September 12, 2024 and sell it today you would earn a total of 12.00 from holding Picton Mahoney Fortified or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Bloom Select Income vs. Picton Mahoney Fortified
Performance |
| Timeline |
| Bloom Select Income |
| Picton Mahoney Fortified |
Bloom Select and Picton Mahoney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Select and Picton Mahoney
The main advantage of trading using opposite Bloom Select and Picton Mahoney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Select position performs unexpectedly, Picton Mahoney 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 Picton Mahoney will offset losses from the drop in Picton Mahoney's long position.| Bloom Select vs. Canadian High Income | Bloom Select vs. Blue Ribbon Income | Bloom Select vs. Energy Income | Bloom Select vs. Australian REIT Income |
| Picton Mahoney vs. RBC Select Balanced | Picton Mahoney vs. RBC Portefeuille de | Picton Mahoney vs. Edgepoint Global Portfolio | Picton Mahoney vs. TD Comfort Balanced |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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