Correlation Between Bank of Montreal and Manulife Finl
Can any of the company-specific risk be diversified away by investing in both Bank of Montreal and Manulife Finl 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 Bank of Montreal and Manulife Finl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Montreal and Manulife Finl Srs, you can compare the effects of market volatilities on Bank of Montreal and Manulife Finl 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 Bank of Montreal with a short position of Manulife Finl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Montreal and Manulife Finl.
Diversification Opportunities for Bank of Montreal and Manulife Finl
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Manulife is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Montreal and Manulife Finl Srs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Finl Srs and Bank of Montreal 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 Bank of Montreal are associated (or correlated) with Manulife Finl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Finl Srs has no effect on the direction of Bank of Montreal i.e., Bank of Montreal and Manulife Finl go up and down completely randomly.
Pair Corralation between Bank of Montreal and Manulife Finl
Assuming the 90 days trading horizon Bank of Montreal is expected to generate 0.51 times more return on investment than Manulife Finl. However, Bank of Montreal is 1.95 times less risky than Manulife Finl. It trades about 0.18 of its potential returns per unit of risk. Manulife Finl Srs is currently generating about 0.08 per unit of risk. If you would invest 2,122 in Bank of Montreal on September 1, 2024 and sell it today you would earn a total of 503.00 from holding Bank of Montreal or generate 23.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Montreal vs. Manulife Finl Srs
Performance |
| Timeline |
| Bank of Montreal |
| Manulife Finl Srs |
Bank of Montreal and Manulife Finl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Montreal and Manulife Finl
The main advantage of trading using opposite Bank of Montreal and Manulife Finl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Montreal position performs unexpectedly, Manulife Finl 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 Manulife Finl will offset losses from the drop in Manulife Finl's long position.| Bank of Montreal vs. Tree Island Steel | Bank of Montreal vs. Eddy Smart Home | Bank of Montreal vs. HOME DEPOT CDR | Bank of Montreal vs. DIRTT Environmental Solutions |
| Manulife Finl vs. Manulife Financial Corp | Manulife Finl vs. Manulife Fin Non | Manulife Finl vs. Great West Lifeco | Manulife Finl vs. Great West Lifeco |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |