Correlation Between IShares Fundamental and CDSPI Petite
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By analyzing existing cross correlation between iShares Fundamental Hedged and CDSPI petite cap, you can compare the effects of market volatilities on IShares Fundamental and CDSPI Petite 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 Fundamental with a short position of CDSPI Petite. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Fundamental and CDSPI Petite.
Diversification Opportunities for IShares Fundamental and CDSPI Petite
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and CDSPI is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding iShares Fundamental Hedged and CDSPI petite cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDSPI petite cap and IShares Fundamental 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 Fundamental Hedged are associated (or correlated) with CDSPI Petite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDSPI petite cap has no effect on the direction of IShares Fundamental i.e., IShares Fundamental and CDSPI Petite go up and down completely randomly.
Pair Corralation between IShares Fundamental and CDSPI Petite
Assuming the 90 days trading horizon IShares Fundamental is expected to generate 1.27 times less return on investment than CDSPI Petite. But when comparing it to its historical volatility, iShares Fundamental Hedged is 1.43 times less risky than CDSPI Petite. It trades about 0.09 of its potential returns per unit of risk. CDSPI petite cap is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 5,156 in CDSPI petite cap on October 29, 2024 and sell it today you would earn a total of 2,260 from holding CDSPI petite cap or generate 43.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.78% |
| Values | Daily Returns |
iShares Fundamental Hedged vs. CDSPI petite cap
Performance |
| Timeline |
| iShares Fundamental |
| CDSPI petite cap |
IShares Fundamental and CDSPI Petite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Fundamental and CDSPI Petite
The main advantage of trading using opposite IShares Fundamental and CDSPI Petite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Fundamental position performs unexpectedly, CDSPI Petite 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 CDSPI Petite will offset losses from the drop in CDSPI Petite's long position.| IShares Fundamental vs. iShares Convertible Bond | IShares Fundamental vs. iShares SP Mid Cap | IShares Fundamental vs. iShares Edge MSCI | IShares Fundamental vs. iShares Flexible Monthly |
| CDSPI Petite vs. Fidelity Canadian Growth | CDSPI Petite vs. Tangerine Equity Growth | CDSPI Petite vs. Edgepoint Cdn Growth | CDSPI Petite vs. Mackenzie Canadian Growth |
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.
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