Correlation Between Evertz Technologies and Manulife Financial
Can any of the company-specific risk be diversified away by investing in both Evertz Technologies and Manulife Financial 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 Evertz Technologies and Manulife Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evertz Technologies Limited and Manulife Financial Corp, you can compare the effects of market volatilities on Evertz Technologies and Manulife Financial 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 Evertz Technologies with a short position of Manulife Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evertz Technologies and Manulife Financial.
Diversification Opportunities for Evertz Technologies and Manulife Financial
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Evertz and Manulife is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Evertz Technologies Limited and Manulife Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Financial Corp and Evertz Technologies 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 Evertz Technologies Limited are associated (or correlated) with Manulife Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Financial Corp has no effect on the direction of Evertz Technologies i.e., Evertz Technologies and Manulife Financial go up and down completely randomly.
Pair Corralation between Evertz Technologies and Manulife Financial
Assuming the 90 days horizon Evertz Technologies is expected to generate 1.38 times less return on investment than Manulife Financial. In addition to that, Evertz Technologies is 1.0 times more volatile than Manulife Financial Corp. It trades about 0.19 of its total potential returns per unit of risk. Manulife Financial Corp is currently generating about 0.26 per unit of volatility. If you would invest 1,662 in Manulife Financial Corp on October 26, 2024 and sell it today you would earn a total of 208.00 from holding Manulife Financial Corp or generate 12.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evertz Technologies Limited vs. Manulife Financial Corp
Performance |
| Timeline |
| Evertz Technologies |
| Manulife Financial Corp |
Evertz Technologies and Manulife Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evertz Technologies and Manulife Financial
The main advantage of trading using opposite Evertz Technologies and Manulife Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evertz Technologies position performs unexpectedly, Manulife Financial 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 Manulife Financial will offset losses from the drop in Manulife Financial's long position.| Evertz Technologies vs. Computer Modelling Group | Evertz Technologies vs. Descartes Systems Group | Evertz Technologies vs. TECSYS Inc | Evertz Technologies vs. Exco Technologies Limited |
| Manulife Financial vs. Prime Dividend Corp | Manulife Financial vs. Canadian Life Companies | Manulife Financial vs. Financial 15 Split | Manulife Financial vs. Dividend 15 Split |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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