Correlation Between E Split and Hamilton Canadian
Can any of the company-specific risk be diversified away by investing in both E Split and Hamilton Canadian 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 E Split and Hamilton Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between E Split Corp and Hamilton Canadian Financials, you can compare the effects of market volatilities on E Split and Hamilton Canadian 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 E Split with a short position of Hamilton Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of E Split and Hamilton Canadian.
Diversification Opportunities for E Split and Hamilton Canadian
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ENS and Hamilton is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding E Split Corp and Hamilton Canadian Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Canadian and E Split 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 E Split Corp are associated (or correlated) with Hamilton Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Canadian has no effect on the direction of E Split i.e., E Split and Hamilton Canadian go up and down completely randomly.
Pair Corralation between E Split and Hamilton Canadian
Assuming the 90 days trading horizon E Split Corp is expected to generate 1.95 times more return on investment than Hamilton Canadian. However, E Split is 1.95 times more volatile than Hamilton Canadian Financials. It trades about 0.18 of its potential returns per unit of risk. Hamilton Canadian Financials is currently generating about 0.28 per unit of risk. If you would invest 1,155 in E Split Corp on November 3, 2024 and sell it today you would earn a total of 278.00 from holding E Split Corp or generate 24.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
E Split Corp vs. Hamilton Canadian Financials
Performance |
| Timeline |
| E Split Corp |
| Hamilton Canadian |
E Split and Hamilton Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with E Split and Hamilton Canadian
The main advantage of trading using opposite E Split and Hamilton Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E Split position performs unexpectedly, Hamilton Canadian 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 Hamilton Canadian will offset losses from the drop in Hamilton Canadian's long position.| E Split vs. Global Dividend Growth | E Split vs. Real Estate E Commerce | E Split vs. Life Banc Split | E Split vs. Brompton Split Banc |
| Hamilton Canadian vs. Hamilton Enhanced Covered | Hamilton Canadian vs. Hamilton Enhanced Multi Sector | Hamilton Canadian vs. Harvest Diversified Monthly | Hamilton Canadian vs. Brompton Enhanced Multi Asset |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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