Correlation Between Dynamic Active and First Trust
Can any of the company-specific risk be diversified away by investing in both Dynamic Active and First Trust 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 Dynamic Active and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynamic Active Global and First Trust Senior, you can compare the effects of market volatilities on Dynamic Active and First Trust 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 Dynamic Active with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynamic Active and First Trust.
Diversification Opportunities for Dynamic Active and First Trust
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dynamic and First is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Dynamic Active Global and First Trust Senior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Senior and Dynamic 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 Dynamic Active Global are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Senior has no effect on the direction of Dynamic Active i.e., Dynamic Active and First Trust go up and down completely randomly.
Pair Corralation between Dynamic Active and First Trust
Assuming the 90 days trading horizon Dynamic Active Global is expected to generate 1.96 times more return on investment than First Trust. However, Dynamic Active is 1.96 times more volatile than First Trust Senior. It trades about 0.23 of its potential returns per unit of risk. First Trust Senior is currently generating about 0.0 per unit of risk. If you would invest 2,402 in Dynamic Active Global on November 23, 2025 and sell it today you would earn a total of 216.00 from holding Dynamic Active Global or generate 8.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynamic Active Global vs. First Trust Senior
Performance |
| Timeline |
| Dynamic Active Global |
| First Trust Senior |
Dynamic Active and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynamic Active and First Trust
The main advantage of trading using opposite Dynamic Active and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynamic Active position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| Dynamic Active vs. BMO SPTSX Equal | Dynamic Active vs. BMO Low Volatility | Dynamic Active vs. Global X Inovestor | Dynamic Active vs. Harvest Global Gold |
| First Trust vs. Fidelity Canadian High | First Trust vs. BMO Balanced ETF | First Trust vs. Global X Active | First Trust vs. BMO Japan Index |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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