Correlation Between Guardian and Guardian Canadian
Can any of the company-specific risk be diversified away by investing in both Guardian and Guardian Canadian 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 and Guardian Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardian i3 Global and Guardian Canadian Bond, you can compare the effects of market volatilities on Guardian and Guardian Canadian 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 with a short position of Guardian Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardian and Guardian Canadian.
Diversification Opportunities for Guardian and Guardian Canadian
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guardian and Guardian is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Guardian i3 Global and Guardian Canadian Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Canadian Bond and Guardian 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 i3 Global are associated (or correlated) with Guardian Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Canadian Bond has no effect on the direction of Guardian i.e., Guardian and Guardian Canadian go up and down completely randomly.
Pair Corralation between Guardian and Guardian Canadian
Assuming the 90 days trading horizon Guardian i3 Global is expected to generate 1.86 times more return on investment than Guardian Canadian. However, Guardian is 1.86 times more volatile than Guardian Canadian Bond. It trades about 0.23 of its potential returns per unit of risk. Guardian Canadian Bond is currently generating about 0.16 per unit of risk. If you would invest 2,856 in Guardian i3 Global on September 1, 2024 and sell it today you would earn a total of 129.00 from holding Guardian i3 Global or generate 4.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guardian i3 Global vs. Guardian Canadian Bond
Performance |
| Timeline |
| Guardian i3 Global |
| Guardian Canadian Bond |
Guardian and Guardian Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardian and Guardian Canadian
The main advantage of trading using opposite Guardian and Guardian Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardian position performs unexpectedly, Guardian Canadian 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 Guardian Canadian will offset losses from the drop in Guardian Canadian's long position.| Guardian vs. Guardian i3 Quality | Guardian vs. Guardian Directed Premium | Guardian vs. Guardian Directed Equity | Guardian vs. CI ONE Global |
| Guardian Canadian vs. BetaPro Gold Bullion | Guardian Canadian vs. BetaPro SP TSX | Guardian Canadian vs. BetaPro SPTSX Capped | Guardian Canadian vs. Global X Active |
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 Stocks Directory module to find actively traded stocks across global markets.
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