Correlation Between CI Yield and CI Munro
Can any of the company-specific risk be diversified away by investing in both CI Yield and CI Munro 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 CI Yield and CI Munro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Yield Enhanced and CI Munro Alternative, you can compare the effects of market volatilities on CI Yield and CI Munro 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 CI Yield with a short position of CI Munro. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Yield and CI Munro.
Diversification Opportunities for CI Yield and CI Munro
Very good diversification
The 3 months correlation between CAGG and CMAG is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding CI Yield Enhanced and CI Munro Alternative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Munro Alternative and CI Yield 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 CI Yield Enhanced are associated (or correlated) with CI Munro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Munro Alternative has no effect on the direction of CI Yield i.e., CI Yield and CI Munro go up and down completely randomly.
Pair Corralation between CI Yield and CI Munro
Assuming the 90 days trading horizon CI Yield is expected to generate 8.52 times less return on investment than CI Munro. But when comparing it to its historical volatility, CI Yield Enhanced is 3.04 times less risky than CI Munro. It trades about 0.1 of its potential returns per unit of risk. CI Munro Alternative is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,523 in CI Munro Alternative on September 3, 2024 and sell it today you would earn a total of 222.00 from holding CI Munro Alternative or generate 6.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Yield Enhanced vs. CI Munro Alternative
Performance |
| Timeline |
| CI Yield Enhanced |
| CI Munro Alternative |
CI Yield and CI Munro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Yield and CI Munro
The main advantage of trading using opposite CI Yield and CI Munro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Yield position performs unexpectedly, CI Munro 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 CI Munro will offset losses from the drop in CI Munro's long position.| CI Yield vs. BMO Short Corporate | CI Yield vs. BMO High Yield | CI Yield vs. iShares Core Canadian | CI Yield vs. Harvest Global REIT |
| CI Munro vs. CI Marret Alternative | CI Munro vs. Dynamic Active Global | CI Munro vs. CI Enhanced Short | CI Munro vs. CI Enhanced Government |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |