Correlation Between Baselode Energy and IShares SPTSX
Can any of the company-specific risk be diversified away by investing in both Baselode Energy and IShares SPTSX 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 Baselode Energy and IShares SPTSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baselode Energy Corp and iShares SPTSX Capped, you can compare the effects of market volatilities on Baselode Energy and IShares SPTSX 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 Baselode Energy with a short position of IShares SPTSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baselode Energy and IShares SPTSX.
Diversification Opportunities for Baselode Energy and IShares SPTSX
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baselode and IShares is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Baselode Energy Corp and iShares SPTSX Capped in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares SPTSX Capped and Baselode Energy 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 Baselode Energy Corp are associated (or correlated) with IShares SPTSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares SPTSX Capped has no effect on the direction of Baselode Energy i.e., Baselode Energy and IShares SPTSX go up and down completely randomly.
Pair Corralation between Baselode Energy and IShares SPTSX
Assuming the 90 days trading horizon Baselode Energy Corp is expected to under-perform the IShares SPTSX. In addition to that, Baselode Energy is 4.03 times more volatile than iShares SPTSX Capped. It trades about -0.11 of its total potential returns per unit of risk. iShares SPTSX Capped is currently generating about -0.02 per unit of volatility. If you would invest 1,896 in iShares SPTSX Capped on August 29, 2024 and sell it today you would lose (109.00) from holding iShares SPTSX Capped or give up 5.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baselode Energy Corp vs. iShares SPTSX Capped
Performance |
| Timeline |
| Baselode Energy Corp |
| iShares SPTSX Capped |
Baselode Energy and IShares SPTSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baselode Energy and IShares SPTSX
The main advantage of trading using opposite Baselode Energy and IShares SPTSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baselode Energy position performs unexpectedly, IShares SPTSX 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 IShares SPTSX will offset losses from the drop in IShares SPTSX's long position.| Baselode Energy vs. Canadian Natural Resources | Baselode Energy vs. Suncor Energy | Baselode Energy vs. iShares Canadian HYBrid | Baselode Energy vs. Altagas Cum Red |
| IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares SPTSX Global | IShares SPTSX vs. iShares SPTSX 60 | IShares SPTSX vs. iShares SPTSX Capped |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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