Correlation Between IShares Convertible and Mackenzie Emerging
Can any of the company-specific risk be diversified away by investing in both IShares Convertible and Mackenzie Emerging 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 Convertible and Mackenzie Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Convertible Bond and Mackenzie Emerging Markets, you can compare the effects of market volatilities on IShares Convertible and Mackenzie Emerging 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 Convertible with a short position of Mackenzie Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Convertible and Mackenzie Emerging.
Diversification Opportunities for IShares Convertible and Mackenzie Emerging
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between IShares and Mackenzie is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding iShares Convertible Bond and Mackenzie Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackenzie Emerging and IShares Convertible 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 Convertible Bond are associated (or correlated) with Mackenzie Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackenzie Emerging has no effect on the direction of IShares Convertible i.e., IShares Convertible and Mackenzie Emerging go up and down completely randomly.
Pair Corralation between IShares Convertible and Mackenzie Emerging
Assuming the 90 days trading horizon iShares Convertible Bond is expected to generate 1.37 times more return on investment than Mackenzie Emerging. However, IShares Convertible is 1.37 times more volatile than Mackenzie Emerging Markets. It trades about 0.05 of its potential returns per unit of risk. Mackenzie Emerging Markets is currently generating about 0.06 per unit of risk. If you would invest 1,482 in iShares Convertible Bond on September 14, 2024 and sell it today you would earn a total of 251.00 from holding iShares Convertible Bond or generate 16.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
iShares Convertible Bond vs. Mackenzie Emerging Markets
Performance |
| Timeline |
| iShares Convertible Bond |
| Mackenzie Emerging |
IShares Convertible and Mackenzie Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Convertible and Mackenzie Emerging
The main advantage of trading using opposite IShares Convertible and Mackenzie Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Convertible position performs unexpectedly, Mackenzie Emerging 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 Mackenzie Emerging will offset losses from the drop in Mackenzie Emerging's long position.| IShares Convertible vs. iShares 1 10Yr Laddered | IShares Convertible vs. CI Canadian Convertible | IShares Convertible vs. iShares Floating Rate | IShares Convertible vs. iShares JP Morgan |
| Mackenzie Emerging vs. iShares IG Corporate | Mackenzie Emerging vs. iShares 1 10Yr Laddered | Mackenzie Emerging vs. iShares Floating Rate | Mackenzie Emerging vs. iShares Convertible Bond |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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