Correlation Between Canso Select and Sun Life
Can any of the company-specific risk be diversified away by investing in both Canso Select and Sun Life 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 Canso Select and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canso Select Opportunities and Sun Life Non, you can compare the effects of market volatilities on Canso Select and Sun Life 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 Canso Select with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canso Select and Sun Life.
Diversification Opportunities for Canso Select and Sun Life
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Canso and Sun is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Canso Select Opportunities and Sun Life Non in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Non and Canso Select 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 Canso Select Opportunities are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Non has no effect on the direction of Canso Select i.e., Canso Select and Sun Life go up and down completely randomly.
Pair Corralation between Canso Select and Sun Life
Assuming the 90 days trading horizon Canso Select Opportunities is expected to generate about the same return on investment as Sun Life Non. However, Canso Select is 2.74 times more volatile than Sun Life Non. It trades about 0.02 of its potential returns per unit of risk. Sun Life Non is currently producing about 0.06 per unit of risk. If you would invest 1,239 in Sun Life Non on September 3, 2024 and sell it today you would earn a total of 393.00 from holding Sun Life Non or generate 31.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Canso Select Opportunities vs. Sun Life Non
Performance |
| Timeline |
| Canso Select Opportu |
| Sun Life Non |
Canso Select and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canso Select and Sun Life
The main advantage of trading using opposite Canso Select and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canso Select position performs unexpectedly, Sun Life 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 Sun Life will offset losses from the drop in Sun Life's long position.| Canso Select vs. Quorum Information Technologies | Canso Select vs. Ramp Metals | Canso Select vs. Brookfield Asset Management | Canso Select vs. NeXGold Mining Corp |
| Sun Life vs. Reliq Health Technologies | Sun Life vs. A W FOOD | Sun Life vs. Guru Organic Energy | Sun Life vs. Andlauer Healthcare Gr |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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