Correlation Between BetaPro SPTSX and Fidelity Canadian
Can any of the company-specific risk be diversified away by investing in both BetaPro SPTSX and Fidelity Canadian 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 SPTSX and Fidelity Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BetaPro SPTSX 60 and Fidelity Canadian High, you can compare the effects of market volatilities on BetaPro SPTSX and Fidelity Canadian 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 SPTSX with a short position of Fidelity Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaPro SPTSX and Fidelity Canadian.
Diversification Opportunities for BetaPro SPTSX and Fidelity Canadian
-0.97 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BetaPro and Fidelity is -0.97. Overlapping area represents the amount of risk that can be diversified away by holding BetaPro SPTSX 60 and Fidelity Canadian High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Canadian High and BetaPro SPTSX 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 SPTSX 60 are associated (or correlated) with Fidelity Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Canadian High has no effect on the direction of BetaPro SPTSX i.e., BetaPro SPTSX and Fidelity Canadian go up and down completely randomly.
Pair Corralation between BetaPro SPTSX and Fidelity Canadian
Assuming the 90 days trading horizon BetaPro SPTSX 60 is expected to under-perform the Fidelity Canadian. In addition to that, BetaPro SPTSX is 2.3 times more volatile than Fidelity Canadian High. It trades about -0.26 of its total potential returns per unit of risk. Fidelity Canadian High is currently generating about 0.2 per unit of volatility. If you would invest 2,922 in Fidelity Canadian High on September 12, 2024 and sell it today you would earn a total of 154.00 from holding Fidelity Canadian High or generate 5.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BetaPro SPTSX 60 vs. Fidelity Canadian High
Performance |
| Timeline |
| BetaPro SPTSX 60 |
| Fidelity Canadian High |
BetaPro SPTSX and Fidelity Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BetaPro SPTSX and Fidelity Canadian
The main advantage of trading using opposite BetaPro SPTSX and Fidelity Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaPro SPTSX position performs unexpectedly, Fidelity Canadian 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 Fidelity Canadian will offset losses from the drop in Fidelity Canadian's long position.| BetaPro SPTSX vs. BetaPro SP 500 | BetaPro SPTSX vs. BetaPro NASDAQ 100 2x | BetaPro SPTSX vs. BetaPro SP TSX | BetaPro SPTSX vs. BetaPro SP 500 |
| Fidelity Canadian vs. iShares SPTSX Composite | Fidelity Canadian vs. iShares Canadian Select | Fidelity Canadian vs. Vanguard FTSE Canadian | Fidelity Canadian vs. BMO Canadian High |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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