Correlation Between CI Global and Evolve Future
Can any of the company-specific risk be diversified away by investing in both CI Global and Evolve Future 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 Global and Evolve Future into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Global Real and Evolve Future Leadership, you can compare the effects of market volatilities on CI Global and Evolve Future 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 Global with a short position of Evolve Future. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Global and Evolve Future.
Diversification Opportunities for CI Global and Evolve Future
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CGRA and Evolve is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding CI Global Real and Evolve Future Leadership in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolve Future Leadership and CI Global 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 Global Real are associated (or correlated) with Evolve Future. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolve Future Leadership has no effect on the direction of CI Global i.e., CI Global and Evolve Future go up and down completely randomly.
Pair Corralation between CI Global and Evolve Future
Assuming the 90 days trading horizon CI Global is expected to generate 5.83 times less return on investment than Evolve Future. But when comparing it to its historical volatility, CI Global Real is 2.05 times less risky than Evolve Future. It trades about 0.09 of its potential returns per unit of risk. Evolve Future Leadership is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,974 in Evolve Future Leadership on September 12, 2024 and sell it today you would earn a total of 446.00 from holding Evolve Future Leadership or generate 22.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
CI Global Real vs. Evolve Future Leadership
Performance |
| Timeline |
| CI Global Real |
| Evolve Future Leadership |
CI Global and Evolve Future Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Global and Evolve Future
The main advantage of trading using opposite CI Global and Evolve Future positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Global position performs unexpectedly, Evolve Future 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 Evolve Future will offset losses from the drop in Evolve Future's long position.| CI Global vs. Guardian i3 Global | CI Global vs. CI Enhanced Short | CI Global vs. BMO Aggregate Bond | CI Global vs. iShares Canadian HYBrid |
| Evolve Future vs. Evolve Global Materials | Evolve Future vs. Evolve Global Healthcare | Evolve Future vs. Evolve Banks Enhanced | Evolve Future vs. Evolve Innovation Index |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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