Correlation Between IShares 1 and BMO Floating
Can any of the company-specific risk be diversified away by investing in both IShares 1 and BMO Floating 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 IShares 1 and BMO Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares 1 5 Year and BMO Floating Rate, you can compare the effects of market volatilities on IShares 1 and BMO Floating 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 IShares 1 with a short position of BMO Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares 1 and BMO Floating.
Diversification Opportunities for IShares 1 and BMO Floating
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and BMO is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding iShares 1 5 Year and BMO Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Floating Rate and IShares 1 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 iShares 1 5 Year are associated (or correlated) with BMO Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Floating Rate has no effect on the direction of IShares 1 i.e., IShares 1 and BMO Floating go up and down completely randomly.
Pair Corralation between IShares 1 and BMO Floating
If you would invest 1,603 in iShares 1 5 Year on September 2, 2024 and sell it today you would earn a total of 134.00 from holding iShares 1 5 Year or generate 8.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
iShares 1 5 Year vs. BMO Floating Rate
Performance |
| Timeline |
| iShares 1 5 |
| BMO Floating Rate |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
IShares 1 and BMO Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares 1 and BMO Floating
The main advantage of trading using opposite IShares 1 and BMO Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares 1 position performs unexpectedly, BMO Floating 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 Floating will offset losses from the drop in BMO Floating's long position.| IShares 1 vs. iShares 1 5 Year | IShares 1 vs. iShares Premium Money | IShares 1 vs. iShares Canadian Government | IShares 1 vs. iShares Global Monthly |
| BMO Floating vs. BMO Emerging Markets | BMO Floating vs. BMO Long Corporate | BMO Floating vs. BMO High Yield | BMO Floating vs. BMO Mid Corporate |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |