Correlation Between Guardian Ultra and BetaPro SPTSX
Can any of the company-specific risk be diversified away by investing in both Guardian Ultra and BetaPro 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 Guardian Ultra and BetaPro SPTSX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardian Ultra Short Canadian and BetaPro SPTSX Capped, you can compare the effects of market volatilities on Guardian Ultra and BetaPro 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 Guardian Ultra with a short position of BetaPro SPTSX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardian Ultra and BetaPro SPTSX.
Diversification Opportunities for Guardian Ultra and BetaPro SPTSX
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Guardian and BetaPro is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Guardian Ultra Short Canadian and BetaPro SPTSX Capped in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BetaPro SPTSX Capped and Guardian Ultra 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 Guardian Ultra Short Canadian are associated (or correlated) with BetaPro SPTSX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BetaPro SPTSX Capped has no effect on the direction of Guardian Ultra i.e., Guardian Ultra and BetaPro SPTSX go up and down completely randomly.
Pair Corralation between Guardian Ultra and BetaPro SPTSX
Assuming the 90 days trading horizon Guardian Ultra Short Canadian is expected to generate 0.01 times more return on investment than BetaPro SPTSX. However, Guardian Ultra Short Canadian is 163.63 times less risky than BetaPro SPTSX. It trades about 0.95 of its potential returns per unit of risk. BetaPro SPTSX Capped is currently generating about -0.01 per unit of risk. If you would invest 4,993 in Guardian Ultra Short Canadian on September 13, 2024 and sell it today you would earn a total of 16.00 from holding Guardian Ultra Short Canadian or generate 0.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guardian Ultra Short Canadian vs. BetaPro SPTSX Capped
Performance |
| Timeline |
| Guardian Ultra Short |
| BetaPro SPTSX Capped |
Guardian Ultra and BetaPro SPTSX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardian Ultra and BetaPro SPTSX
The main advantage of trading using opposite Guardian Ultra and BetaPro SPTSX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardian Ultra position performs unexpectedly, BetaPro 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 BetaPro SPTSX will offset losses from the drop in BetaPro SPTSX's long position.| Guardian Ultra vs. BetaPro SPTSX Capped | Guardian Ultra vs. BetaPro SPTSX 60 | Guardian Ultra vs. BetaPro SP 500 | Guardian Ultra vs. BetaPro NASDAQ 100 2x |
| BetaPro SPTSX vs. BetaPro SP 500 | BetaPro SPTSX vs. BetaPro NASDAQ 100 2x | BetaPro SPTSX vs. BetaPro SP TSX | BetaPro SPTSX vs. BetaPro SP 500 |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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