Correlation Between BetaPro Crude and Mackenzie High
Can any of the company-specific risk be diversified away by investing in both BetaPro Crude and Mackenzie High 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 BetaPro Crude and Mackenzie High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BetaPro Crude Oil and Mackenzie High Yield, you can compare the effects of market volatilities on BetaPro Crude and Mackenzie High 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 BetaPro Crude with a short position of Mackenzie High. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro Crude and Mackenzie High.
Diversification Opportunities for BetaPro Crude and Mackenzie High
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BetaPro and Mackenzie is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro Crude Oil and Mackenzie High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackenzie High Yield and BetaPro Crude 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 BetaPro Crude Oil are associated (or correlated) with Mackenzie High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackenzie High Yield has no effect on the direction of BetaPro Crude i.e., BetaPro Crude and Mackenzie High go up and down completely randomly.
Pair Corralation between BetaPro Crude and Mackenzie High
Assuming the 90 days trading horizon BetaPro Crude Oil is expected to under-perform the Mackenzie High. In addition to that, BetaPro Crude is 6.93 times more volatile than Mackenzie High Yield. It trades about 0.0 of its total potential returns per unit of risk. Mackenzie High Yield is currently generating about 0.12 per unit of volatility. If you would invest 8,183 in Mackenzie High Yield on November 4, 2024 and sell it today you would earn a total of 87.00 from holding Mackenzie High Yield or generate 1.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BetaPro Crude Oil vs. Mackenzie High Yield
Performance |
| Timeline |
| BetaPro Crude Oil |
| Mackenzie High Yield |
BetaPro Crude and Mackenzie High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BetaPro Crude and Mackenzie High
The main advantage of trading using opposite BetaPro Crude and Mackenzie High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaPro Crude position performs unexpectedly, Mackenzie High 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 Mackenzie High will offset losses from the drop in Mackenzie High's long position.| BetaPro Crude vs. BetaPro Crude Oil | BetaPro Crude vs. BetaPro Natural Gas | BetaPro Crude vs. BetaPro Natural Gas | BetaPro Crude vs. BetaPro Canadian Gold |
| Mackenzie High vs. Mackenzie Developed ex North | Mackenzie High vs. Mackenzie Global Sustainable | Mackenzie High vs. Mackenzie Aggregate Bond | Mackenzie High vs. Mackenzie Canadian Ultra |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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