Correlation Between SPTSX Dividend and North American
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and North American Financial, you can compare the effects of market volatilities on SPTSX Dividend and North American 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 SPTSX Dividend with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and North American.
Diversification Opportunities for SPTSX Dividend and North American
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SPTSX and North is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and North American Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Financial and SPTSX Dividend 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 SPTSX Dividend Aristocrats are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Financial has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and North American go up and down completely randomly.
Pair Corralation between SPTSX Dividend and North American
Assuming the 90 days trading horizon SPTSX Dividend is expected to generate 1.47 times less return on investment than North American. In addition to that, SPTSX Dividend is 1.88 times more volatile than North American Financial. It trades about 0.18 of its total potential returns per unit of risk. North American Financial is currently generating about 0.5 per unit of volatility. If you would invest 1,032 in North American Financial on August 28, 2024 and sell it today you would earn a total of 27.00 from holding North American Financial or generate 2.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. North American Financial
Performance |
| Timeline |
SPTSX Dividend and North American Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
North American Financial
Pair trading matchups for North American
Pair Trading with SPTSX Dividend and North American
The main advantage of trading using opposite SPTSX Dividend and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.| SPTSX Dividend vs. High Liner Foods | SPTSX Dividend vs. TUT Fitness Group | SPTSX Dividend vs. MTY Food Group | SPTSX Dividend vs. UnitedHealth Group CDR |
| North American vs. Financial 15 Split | North American vs. Dividend 15 Split | North American vs. Dividend Growth Split | North American vs. Dividend 15 Split |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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