Correlation Between Global Healthcare and CI Global
Can any of the company-specific risk be diversified away by investing in both Global Healthcare and CI Global at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Global Healthcare and CI Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Healthcare Income and CI Global Real, you can compare the effects of market volatilities on Global Healthcare and CI Global 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 Global Healthcare with a short position of CI Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Healthcare and CI Global.
Diversification Opportunities for Global Healthcare and CI Global
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and CGRA is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Global Healthcare Income and CI Global Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Global Real and Global Healthcare 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 Global Healthcare Income are associated (or correlated) with CI Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Global Real has no effect on the direction of Global Healthcare i.e., Global Healthcare and CI Global go up and down completely randomly.
Pair Corralation between Global Healthcare and CI Global
Assuming the 90 days trading horizon Global Healthcare is expected to generate 7.64 times less return on investment than CI Global. In addition to that, Global Healthcare is 1.23 times more volatile than CI Global Real. It trades about 0.02 of its total potential returns per unit of risk. CI Global Real is currently generating about 0.16 per unit of volatility. If you would invest 2,261 in CI Global Real on September 1, 2024 and sell it today you would earn a total of 55.00 from holding CI Global Real or generate 2.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Healthcare Income vs. CI Global Real
Performance |
| Timeline |
| Global Healthcare Income |
| CI Global Real |
Global Healthcare and CI Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Healthcare and CI Global
The main advantage of trading using opposite Global Healthcare and CI Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Healthcare position performs unexpectedly, CI Global 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 CI Global will offset losses from the drop in CI Global's long position.| Global Healthcare vs. Tech Leaders Income | Global Healthcare vs. BetaPro SPTSX 60 | Global Healthcare vs. Brompton Global Dividend | Global Healthcare vs. Global X Active |
| CI Global vs. CI Global REIT | CI Global vs. CI Global Infrastructure | CI Global vs. CI Global Asset | CI Global vs. CI Marret Alternative |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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