Correlation Between Fidelity Canadian and Mackenzie Large
Can any of the company-specific risk be diversified away by investing in both Fidelity Canadian and Mackenzie Large 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 Fidelity Canadian and Mackenzie Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Canadian High and Mackenzie Large Cap, you can compare the effects of market volatilities on Fidelity Canadian and Mackenzie Large 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 Fidelity Canadian with a short position of Mackenzie Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Canadian and Mackenzie Large.
Diversification Opportunities for Fidelity Canadian and Mackenzie Large
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Mackenzie is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Canadian High and Mackenzie Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackenzie Large Cap and Fidelity Canadian 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 Fidelity Canadian High are associated (or correlated) with Mackenzie Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackenzie Large Cap has no effect on the direction of Fidelity Canadian i.e., Fidelity Canadian and Mackenzie Large go up and down completely randomly.
Pair Corralation between Fidelity Canadian and Mackenzie Large
Assuming the 90 days trading horizon Fidelity Canadian is expected to generate 1.5 times less return on investment than Mackenzie Large. But when comparing it to its historical volatility, Fidelity Canadian High is 1.12 times less risky than Mackenzie Large. It trades about 0.1 of its potential returns per unit of risk. Mackenzie Large Cap is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 15,066 in Mackenzie Large Cap on September 4, 2024 and sell it today you would earn a total of 9,473 from holding Mackenzie Large Cap or generate 62.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Canadian High vs. Mackenzie Large Cap
Performance |
| Timeline |
| Fidelity Canadian High |
| Mackenzie Large Cap |
Fidelity Canadian and Mackenzie Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Canadian and Mackenzie Large
The main advantage of trading using opposite Fidelity Canadian and Mackenzie Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Canadian position performs unexpectedly, Mackenzie Large 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 Large will offset losses from the drop in Mackenzie Large's long position.| Fidelity Canadian vs. Mackenzie Large Cap | Fidelity Canadian vs. Goldman Sachs ActiveBeta | Fidelity Canadian vs. BMO MSCI EAFE | Fidelity Canadian vs. BMO Long Federal |
| Mackenzie Large vs. Franklin Bissett Corporate | Mackenzie Large vs. FT AlphaDEX Industrials | Mackenzie Large vs. Dynamic Active Dividend | Mackenzie Large vs. BMO Aggregate 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |