Correlation Between CI Investment and CI Global
Can any of the company-specific risk be diversified away by investing in both CI Investment and CI Global 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 CI Investment and CI Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Investment Grade and CI Global Financial, you can compare the effects of market volatilities on CI Investment and CI Global 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 CI Investment with a short position of CI Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Investment and CI Global.
Diversification Opportunities for CI Investment and CI Global
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between FIG and FSF is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding CI Investment Grade and CI Global Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Global Financial and CI Investment 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 CI Investment Grade are associated (or correlated) with CI Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Global Financial has no effect on the direction of CI Investment i.e., CI Investment and CI Global go up and down completely randomly.
Pair Corralation between CI Investment and CI Global
Assuming the 90 days trading horizon CI Investment Grade is expected to under-perform the CI Global. But the etf apears to be less risky and, when comparing its historical volatility, CI Investment Grade is 2.53 times less risky than CI Global. The etf trades about -0.04 of its potential returns per unit of risk. The CI Global Financial is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,906 in CI Global Financial on August 25, 2024 and sell it today you would earn a total of 147.00 from holding CI Global Financial or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Investment Grade vs. CI Global Financial
Performance |
| Timeline |
| CI Investment Grade |
| CI Global Financial |
CI Investment and CI Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Investment and CI Global
The main advantage of trading using opposite CI Investment and CI Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Investment position performs unexpectedly, CI Global 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 CI Global will offset losses from the drop in CI Global's long position.| CI Investment vs. CI Enhanced Short | CI Investment vs. Global X Active | CI Investment vs. Mackenzie Unconstrained Bond | CI Investment vs. CI Enhanced Government |
| CI Global vs. CI Preferred Share | CI Global vs. First Asset Morningstar | CI Global vs. CI Short Term | CI Global vs. CI Investment Grade |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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