Correlation Between CI Global and BetaPro SPTSX
Can any of the company-specific risk be diversified away by investing in both CI Global and BetaPro SPTSX 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 BetaPro SPTSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Global Climate and BetaPro SPTSX Capped, you can compare the effects of market volatilities on CI Global and BetaPro SPTSX 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 BetaPro SPTSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Global and BetaPro SPTSX.
Diversification Opportunities for CI Global and BetaPro SPTSX
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CLML and BetaPro is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding CI Global Climate and BetaPro SPTSX Capped in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BetaPro SPTSX Capped 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 Climate are associated (or correlated) with BetaPro SPTSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BetaPro SPTSX Capped has no effect on the direction of CI Global i.e., CI Global and BetaPro SPTSX go up and down completely randomly.
Pair Corralation between CI Global and BetaPro SPTSX
Assuming the 90 days trading horizon CI Global Climate is expected to generate 0.54 times more return on investment than BetaPro SPTSX. However, CI Global Climate is 1.86 times less risky than BetaPro SPTSX. It trades about 0.09 of its potential returns per unit of risk. BetaPro SPTSX Capped is currently generating about 0.03 per unit of risk. If you would invest 2,794 in CI Global Climate on November 3, 2024 and sell it today you would earn a total of 701.00 from holding CI Global Climate or generate 25.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Global Climate vs. BetaPro SPTSX Capped
Performance |
| Timeline |
| CI Global Climate |
| BetaPro SPTSX Capped |
CI Global and BetaPro SPTSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Global and BetaPro SPTSX
The main advantage of trading using opposite CI Global and BetaPro SPTSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Global position performs unexpectedly, BetaPro SPTSX 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 BetaPro SPTSX will offset losses from the drop in BetaPro SPTSX's long position.| CI Global vs. NBI High Yield | CI Global vs. NBI Unconstrained Fixed | CI Global vs. Mackenzie Developed ex North | CI Global vs. BMO Short Term Bond |
| BetaPro SPTSX vs. BetaPro SP TSX | BetaPro SPTSX vs. BetaPro SP TSX | BetaPro SPTSX vs. BetaPro SPTSX Capped | BetaPro SPTSX vs. BetaPro SPTSX 60 |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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