Correlation Between SPTSX Dividend and RBC PHN
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and RBC PHN Short, you can compare the effects of market volatilities on SPTSX Dividend and RBC PHN 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 RBC PHN. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and RBC PHN.
Diversification Opportunities for SPTSX Dividend and RBC PHN
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SPTSX and RBC is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and RBC PHN Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RBC PHN Short 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 RBC PHN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RBC PHN Short has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and RBC PHN go up and down completely randomly.
Pair Corralation between SPTSX Dividend and RBC PHN
Assuming the 90 days trading horizon SPTSX Dividend Aristocrats is expected to generate 3.42 times more return on investment than RBC PHN. However, SPTSX Dividend is 3.42 times more volatile than RBC PHN Short. It trades about 0.06 of its potential returns per unit of risk. RBC PHN Short is currently generating about 0.09 per unit of risk. If you would invest 31,175 in SPTSX Dividend Aristocrats on September 3, 2024 and sell it today you would earn a total of 6,396 from holding SPTSX Dividend Aristocrats or generate 20.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.58% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. RBC PHN Short
Performance |
| Timeline |
SPTSX Dividend and RBC PHN Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
RBC PHN Short
Pair trading matchups for RBC PHN
Pair Trading with SPTSX Dividend and RBC PHN
The main advantage of trading using opposite SPTSX Dividend and RBC PHN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, RBC PHN 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 RBC PHN will offset losses from the drop in RBC PHN's long position.| SPTSX Dividend vs. 2028 Investment Grade | SPTSX Dividend vs. Upstart Investments | SPTSX Dividend vs. Brookfield Investments | SPTSX Dividend vs. Atrium Mortgage Investment |
| RBC PHN vs. BMO Short Federal | RBC PHN vs. BMO Short Corporate | RBC PHN vs. BMO Mid Corporate | RBC PHN vs. BMO Long Corporate |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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