Correlation Between SPTSX Dividend and BMO Premium
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and BMO Premium Yield, you can compare the effects of market volatilities on SPTSX Dividend and BMO Premium 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 BMO Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and BMO Premium.
Diversification Opportunities for SPTSX Dividend and BMO Premium
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPTSX and BMO is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and BMO Premium Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Premium Yield 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 BMO Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Premium Yield has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and BMO Premium go up and down completely randomly.
Pair Corralation between SPTSX Dividend and BMO Premium
Assuming the 90 days trading horizon SPTSX Dividend is expected to generate 1.2 times less return on investment than BMO Premium. But when comparing it to its historical volatility, SPTSX Dividend Aristocrats is 1.15 times less risky than BMO Premium. It trades about 0.15 of its potential returns per unit of risk. BMO Premium Yield is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 3,241 in BMO Premium Yield on August 29, 2024 and sell it today you would earn a total of 59.00 from holding BMO Premium Yield or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. BMO Premium Yield
Performance |
| Timeline |
SPTSX Dividend and BMO Premium Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
BMO Premium Yield
Pair trading matchups for BMO Premium
Pair Trading with SPTSX Dividend and BMO Premium
The main advantage of trading using opposite SPTSX Dividend and BMO Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, BMO Premium 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 BMO Premium will offset losses from the drop in BMO Premium's long position.| SPTSX Dividend vs. Thunderbird Entertainment Group | SPTSX Dividend vs. Firan Technology Group | SPTSX Dividend vs. Computer Modelling Group | SPTSX Dividend vs. Northstar Clean Technologies |
| BMO Premium vs. iShares SPTSX 60 | BMO Premium vs. iShares Core SP | BMO Premium vs. iShares Core SPTSX | BMO Premium vs. BMO Aggregate Bond |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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