Correlation Between 3iQ Bitcoin and BMO Global
Can any of the company-specific risk be diversified away by investing in both 3iQ Bitcoin and BMO Global 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 3iQ Bitcoin and BMO Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3iQ Bitcoin ETF and BMO Global Consumer, you can compare the effects of market volatilities on 3iQ Bitcoin and BMO Global 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 3iQ Bitcoin with a short position of BMO Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3iQ Bitcoin and BMO Global.
Diversification Opportunities for 3iQ Bitcoin and BMO Global
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 3iQ and BMO is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding 3iQ Bitcoin ETF and BMO Global Consumer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Global Consumer and 3iQ Bitcoin 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 3iQ Bitcoin ETF are associated (or correlated) with BMO Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Global Consumer has no effect on the direction of 3iQ Bitcoin i.e., 3iQ Bitcoin and BMO Global go up and down completely randomly.
Pair Corralation between 3iQ Bitcoin and BMO Global
Assuming the 90 days trading horizon 3iQ Bitcoin ETF is expected to generate 5.57 times more return on investment than BMO Global. However, 3iQ Bitcoin is 5.57 times more volatile than BMO Global Consumer. It trades about 0.14 of its potential returns per unit of risk. BMO Global Consumer is currently generating about 0.03 per unit of risk. If you would invest 576.00 in 3iQ Bitcoin ETF on September 12, 2024 and sell it today you would earn a total of 1,596 from holding 3iQ Bitcoin ETF or generate 277.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
3iQ Bitcoin ETF vs. BMO Global Consumer
Performance |
| Timeline |
| 3iQ Bitcoin ETF |
| BMO Global Consumer |
3iQ Bitcoin and BMO Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3iQ Bitcoin and BMO Global
The main advantage of trading using opposite 3iQ Bitcoin and BMO Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3iQ Bitcoin position performs unexpectedly, BMO Global 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 Global will offset losses from the drop in BMO Global's long position.| 3iQ Bitcoin vs. Purpose Bitcoin CAD | 3iQ Bitcoin vs. BMO Aggregate Bond | 3iQ Bitcoin vs. iShares Canadian HYBrid | 3iQ Bitcoin vs. Brompton European Dividend |
| BMO Global vs. BMO Global Consumer | BMO Global vs. iShares SPTSX Capped | BMO Global vs. BMO Global Communications | BMO Global vs. BMO Global Infrastructure |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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