Correlation Between CI Global and Brompton Global
Can any of the company-specific risk be diversified away by investing in both CI Global and Brompton 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 Global and Brompton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Global Financial and Brompton Global Dividend, you can compare the effects of market volatilities on CI Global and Brompton 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 Global with a short position of Brompton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Global and Brompton Global.
Diversification Opportunities for CI Global and Brompton Global
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between FSF and Brompton is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding CI Global Financial and Brompton Global Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brompton Global Dividend and CI Global 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 Global Financial are associated (or correlated) with Brompton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brompton Global Dividend has no effect on the direction of CI Global i.e., CI Global and Brompton Global go up and down completely randomly.
Pair Corralation between CI Global and Brompton Global
Assuming the 90 days trading horizon CI Global Financial is expected to generate 1.03 times more return on investment than Brompton Global. However, CI Global is 1.03 times more volatile than Brompton Global Dividend. It trades about 0.23 of its potential returns per unit of risk. Brompton Global Dividend is currently generating about 0.14 per unit of risk. If you would invest 2,743 in CI Global Financial on August 28, 2024 and sell it today you would earn a total of 310.00 from holding CI Global Financial or generate 11.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Global Financial vs. Brompton Global Dividend
Performance |
| Timeline |
| CI Global Financial |
| Brompton Global Dividend |
CI Global and Brompton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Global and Brompton Global
The main advantage of trading using opposite CI Global and Brompton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Global position performs unexpectedly, Brompton 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 Brompton Global will offset losses from the drop in Brompton Global's long position.| CI Global vs. Brompton Global Dividend | CI Global vs. Tech Leaders Income | CI Global vs. Global Healthcare Income | CI Global vs. Brompton European Dividend |
| Brompton Global vs. Global Healthcare Income | Brompton Global vs. Tech Leaders Income | Brompton Global vs. Brompton North American | Brompton Global vs. Brompton European Dividend |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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