Correlation Between Evolve Active and Lysander Slater
Can any of the company-specific risk be diversified away by investing in both Evolve Active and Lysander Slater 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 Evolve Active and Lysander Slater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolve Active Canadian and Lysander Slater Preferred Share, you can compare the effects of market volatilities on Evolve Active and Lysander Slater 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 Evolve Active with a short position of Lysander Slater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolve Active and Lysander Slater.
Diversification Opportunities for Evolve Active and Lysander Slater
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Evolve and Lysander is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Active Canadian and Lysander Slater Preferred Shar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lysander Slater Pref and Evolve Active 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 Evolve Active Canadian are associated (or correlated) with Lysander Slater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lysander Slater Pref has no effect on the direction of Evolve Active i.e., Evolve Active and Lysander Slater go up and down completely randomly.
Pair Corralation between Evolve Active and Lysander Slater
Assuming the 90 days trading horizon Evolve Active is expected to generate 1.32 times less return on investment than Lysander Slater. But when comparing it to its historical volatility, Evolve Active Canadian is 2.16 times less risky than Lysander Slater. It trades about 0.3 of its potential returns per unit of risk. Lysander Slater Preferred Share is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 948.00 in Lysander Slater Preferred Share on September 4, 2024 and sell it today you would earn a total of 18.00 from holding Lysander Slater Preferred Share or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolve Active Canadian vs. Lysander Slater Preferred Shar
Performance |
| Timeline |
| Evolve Active Canadian |
| Lysander Slater Pref |
Evolve Active and Lysander Slater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolve Active and Lysander Slater
The main advantage of trading using opposite Evolve Active and Lysander Slater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolve Active position performs unexpectedly, Lysander Slater 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 Lysander Slater will offset losses from the drop in Lysander Slater's long position.| Evolve Active vs. Evolve Banks Enhanced | Evolve Active vs. Evolve Global Healthcare | Evolve Active vs. Evolve Global Materials | Evolve Active vs. Evolve Active Global |
| Lysander Slater vs. BMO Laddered Preferred | Lysander Slater vs. iShares SPTSX Canadian | Lysander Slater vs. RBC Quant 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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