Correlation Between First Asset and RBC Quant
Can any of the company-specific risk be diversified away by investing in both First Asset and RBC Quant 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 First Asset and RBC Quant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Asset Canadian and RBC Quant European, you can compare the effects of market volatilities on First Asset and RBC Quant 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 First Asset with a short position of RBC Quant. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Asset and RBC Quant.
Diversification Opportunities for First Asset and RBC Quant
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and RBC is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding First Asset Canadian and RBC Quant European in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RBC Quant European and First Asset 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 First Asset Canadian are associated (or correlated) with RBC Quant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RBC Quant European has no effect on the direction of First Asset i.e., First Asset and RBC Quant go up and down completely randomly.
Pair Corralation between First Asset and RBC Quant
Assuming the 90 days trading horizon First Asset is expected to generate 1.9 times less return on investment than RBC Quant. In addition to that, First Asset is 1.22 times more volatile than RBC Quant European. It trades about 0.08 of its total potential returns per unit of risk. RBC Quant European is currently generating about 0.18 per unit of volatility. If you would invest 2,848 in RBC Quant European on September 29, 2025 and sell it today you would earn a total of 409.00 from holding RBC Quant European or generate 14.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Asset Canadian vs. RBC Quant European
Performance |
| Timeline |
| First Asset Canadian |
| RBC Quant European |
First Asset and RBC Quant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Asset and RBC Quant
The main advantage of trading using opposite First Asset and RBC Quant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Asset position performs unexpectedly, RBC Quant 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 RBC Quant will offset losses from the drop in RBC Quant's long position.| First Asset vs. CI MidCap Dividend | First Asset vs. TD Active Enhanced | First Asset vs. Invesco SPTSX Canadian | First Asset vs. Fidelity Canadian Monthly |
| RBC Quant vs. Global X Enhanced | RBC Quant vs. Brompton North American | RBC Quant vs. BMO Global Enhanced | RBC Quant vs. Purpose Total Return |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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