Correlation Between CI High and IShares 1
Can any of the company-specific risk be diversified away by investing in both CI High and IShares 1 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 High and IShares 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI High Interest and iShares 1 5 Year, you can compare the effects of market volatilities on CI High and IShares 1 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 High with a short position of IShares 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI High and IShares 1.
Diversification Opportunities for CI High and IShares 1
Significant diversification
The 3 months correlation between CSAV and IShares is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding CI High Interest and iShares 1 5 Year in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares 1 5 and CI High 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 High Interest are associated (or correlated) with IShares 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares 1 5 has no effect on the direction of CI High i.e., CI High and IShares 1 go up and down completely randomly.
Pair Corralation between CI High and IShares 1
Assuming the 90 days trading horizon CI High Interest is expected to under-perform the IShares 1. But the etf apears to be less risky and, when comparing its historical volatility, CI High Interest is 2.8 times less risky than IShares 1. The etf trades about -0.03 of its potential returns per unit of risk. The iShares 1 5 Year is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,724 in iShares 1 5 Year on September 14, 2024 and sell it today you would earn a total of 15.00 from holding iShares 1 5 Year or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI High Interest vs. iShares 1 5 Year
Performance |
| Timeline |
| CI High Interest |
| iShares 1 5 |
CI High and IShares 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI High and IShares 1
The main advantage of trading using opposite CI High and IShares 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI High position performs unexpectedly, IShares 1 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 IShares 1 will offset losses from the drop in IShares 1's long position.| CI High vs. Purpose High Interest | CI High vs. GLOBAL X HIGH | CI High vs. Global X Cash | CI High vs. iShares Premium Money |
| IShares 1 vs. iShares Canadian Universe | IShares 1 vs. iShares Canadian Real | IShares 1 vs. iShares Core Canadian | IShares 1 vs. iShares Core Canadian |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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