Correlation Between SPTSX Dividend and BMO Real
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By analyzing existing cross correlation between SPTSX Dividend Aristocrats and BMO Real Return, you can compare the effects of market volatilities on SPTSX Dividend and BMO Real 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 Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPTSX Dividend and BMO Real.
Diversification Opportunities for SPTSX Dividend and BMO Real
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPTSX and BMO is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding SPTSX Dividend Aristocrats and BMO Real Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Real Return 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 Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Real Return has no effect on the direction of SPTSX Dividend i.e., SPTSX Dividend and BMO Real go up and down completely randomly.
Pair Corralation between SPTSX Dividend and BMO Real
Assuming the 90 days trading horizon SPTSX Dividend Aristocrats is expected to generate 0.64 times more return on investment than BMO Real. However, SPTSX Dividend Aristocrats is 1.56 times less risky than BMO Real. It trades about 0.42 of its potential returns per unit of risk. BMO Real Return is currently generating about 0.1 per unit of risk. If you would invest 36,294 in SPTSX Dividend Aristocrats on September 1, 2024 and sell it today you would earn a total of 1,277 from holding SPTSX Dividend Aristocrats or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SPTSX Dividend Aristocrats vs. BMO Real Return
Performance |
| Timeline |
SPTSX Dividend and BMO Real Volatility Contrast
Predicted Return Density |
| Returns |
SPTSX Dividend Aristocrats
Pair trading matchups for SPTSX Dividend
BMO Real Return
Pair trading matchups for BMO Real
Pair Trading with SPTSX Dividend and BMO Real
The main advantage of trading using opposite SPTSX Dividend and BMO Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPTSX Dividend position performs unexpectedly, BMO Real 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 Real will offset losses from the drop in BMO Real's long position.| SPTSX Dividend vs. Metalero Mining Corp | SPTSX Dividend vs. TUT Fitness Group | SPTSX Dividend vs. Dream Industrial Real | SPTSX Dividend vs. Nicola Mining |
| BMO Real vs. BMO Long Corporate | BMO Real vs. BMO Short Provincial | BMO Real vs. BMO Short Federal | BMO Real vs. BMO Emerging Markets |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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