Correlation Between Hamilton MidSmall and Hamilton REITs
Can any of the company-specific risk be diversified away by investing in both Hamilton MidSmall and Hamilton REITs 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 Hamilton MidSmall and Hamilton REITs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hamilton MidSmall Cap Financials and Hamilton REITs YIELD, you can compare the effects of market volatilities on Hamilton MidSmall and Hamilton REITs 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 Hamilton MidSmall with a short position of Hamilton REITs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hamilton MidSmall and Hamilton REITs.
Diversification Opportunities for Hamilton MidSmall and Hamilton REITs
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hamilton and Hamilton is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton MidSmall Cap Financia and Hamilton REITs YIELD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton REITs YIELD and Hamilton MidSmall 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 Hamilton MidSmall Cap Financials are associated (or correlated) with Hamilton REITs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton REITs YIELD has no effect on the direction of Hamilton MidSmall i.e., Hamilton MidSmall and Hamilton REITs go up and down completely randomly.
Pair Corralation between Hamilton MidSmall and Hamilton REITs
Assuming the 90 days trading horizon Hamilton MidSmall Cap Financials is expected to generate 2.98 times more return on investment than Hamilton REITs. However, Hamilton MidSmall is 2.98 times more volatile than Hamilton REITs YIELD. It trades about 0.2 of its potential returns per unit of risk. Hamilton REITs YIELD is currently generating about -0.03 per unit of risk. If you would invest 3,474 in Hamilton MidSmall Cap Financials on August 28, 2024 and sell it today you would earn a total of 320.00 from holding Hamilton MidSmall Cap Financials or generate 9.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hamilton MidSmall Cap Financia vs. Hamilton REITs YIELD
Performance |
| Timeline |
| Hamilton MidSmall Cap |
| Hamilton REITs YIELD |
Hamilton MidSmall and Hamilton REITs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hamilton MidSmall and Hamilton REITs
The main advantage of trading using opposite Hamilton MidSmall and Hamilton REITs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hamilton MidSmall position performs unexpectedly, Hamilton REITs 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 Hamilton REITs will offset losses from the drop in Hamilton REITs' long position.| Hamilton MidSmall vs. Global Atomic Corp | Hamilton MidSmall vs. enCore Energy Corp | Hamilton MidSmall vs. Fission Uranium Corp | Hamilton MidSmall vs. NexGen Energy |
| Hamilton REITs vs. Hamilton Equity Yield | Hamilton REITs vs. Hamilton Enhanced Canadian | Hamilton REITs vs. Hamilton Australian Bank | Hamilton REITs vs. Hamilton MidSmall Cap Financials |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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