Correlation Between Harvest Equal and Scotia International
Can any of the company-specific risk be diversified away by investing in both Harvest Equal and Scotia International 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 Harvest Equal and Scotia International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harvest Equal Weight and Scotia International Equity, you can compare the effects of market volatilities on Harvest Equal and Scotia International 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 Harvest Equal with a short position of Scotia International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harvest Equal and Scotia International.
Diversification Opportunities for Harvest Equal and Scotia International
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Harvest and Scotia is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Harvest Equal Weight and Scotia International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scotia International and Harvest Equal 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 Harvest Equal Weight are associated (or correlated) with Scotia International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scotia International has no effect on the direction of Harvest Equal i.e., Harvest Equal and Scotia International go up and down completely randomly.
Pair Corralation between Harvest Equal and Scotia International
Assuming the 90 days trading horizon Harvest Equal is expected to generate 1.33 times less return on investment than Scotia International. In addition to that, Harvest Equal is 1.22 times more volatile than Scotia International Equity. It trades about 0.06 of its total potential returns per unit of risk. Scotia International Equity is currently generating about 0.09 per unit of volatility. If you would invest 2,114 in Scotia International Equity on September 6, 2024 and sell it today you would earn a total of 634.00 from holding Scotia International Equity or generate 29.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Harvest Equal Weight vs. Scotia International Equity
Performance |
| Timeline |
| Harvest Equal Weight |
| Scotia International |
Harvest Equal and Scotia International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harvest Equal and Scotia International
The main advantage of trading using opposite Harvest Equal and Scotia International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harvest Equal position performs unexpectedly, Scotia International 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 Scotia International will offset losses from the drop in Scotia International's long position.| Harvest Equal vs. Harvest Healthcare Leaders | Harvest Equal vs. CI Gold Giants | Harvest Equal vs. BMO Global High | Harvest Equal vs. First Asset Energy |
| Scotia International vs. First Asset Energy | Scotia International vs. First Asset Tech | Scotia International vs. Harvest Equal Weight | Scotia International vs. CI Canada Lifeco |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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