Correlation Between SPTSX Dividend and BMO Put
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and BMO Put Write, you can compare the effects of market volatilities on SPTSX Dividend and BMO Put 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 Put. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and BMO Put.
Diversification Opportunities for SPTSX Dividend and BMO Put
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPTSX and BMO is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and BMO Put Write in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Put Write 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 Put. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Put Write has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and BMO Put go up and down completely randomly.
Pair Corralation between SPTSX Dividend and BMO Put
Assuming the 90 days trading horizon SPTSX Dividend Aristocrats is expected to generate 0.7 times more return on investment than BMO Put. However, SPTSX Dividend Aristocrats is 1.43 times less risky than BMO Put. It trades about 0.15 of its potential returns per unit of risk. BMO Put Write is currently generating about 0.08 per unit of risk. If you would invest 36,732 in SPTSX Dividend Aristocrats on August 29, 2024 and sell it today you would earn a total of 558.00 from holding SPTSX Dividend Aristocrats or generate 1.52% 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 Put Write
Performance |
| Timeline |
SPTSX Dividend and BMO Put Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
BMO Put Write
Pair trading matchups for BMO Put
Pair Trading with SPTSX Dividend and BMO Put
The main advantage of trading using opposite SPTSX Dividend and BMO Put positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, BMO Put 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 Put will offset losses from the drop in BMO Put'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 Put vs. BMO Put Write | BMO Put vs. BMO Europe High | BMO Put vs. BMO High Dividend | BMO Put vs. BMO Europe High |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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