Correlation Between Manulife Smart and First Asset
Can any of the company-specific risk be diversified away by investing in both Manulife Smart and First Asset 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 Manulife Smart and First Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Smart International and First Asset Energy, you can compare the effects of market volatilities on Manulife Smart and First Asset 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 Manulife Smart with a short position of First Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Smart and First Asset.
Diversification Opportunities for Manulife Smart and First Asset
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Manulife and First is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Smart International and First Asset Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Asset Energy and Manulife Smart 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 Manulife Smart International are associated (or correlated) with First Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Asset Energy has no effect on the direction of Manulife Smart i.e., Manulife Smart and First Asset go up and down completely randomly.
Pair Corralation between Manulife Smart and First Asset
Assuming the 90 days trading horizon Manulife Smart International is expected to under-perform the First Asset. But the etf apears to be less risky and, when comparing its historical volatility, Manulife Smart International is 1.9 times less risky than First Asset. The etf trades about -0.21 of its potential returns per unit of risk. The First Asset Energy is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 571.00 in First Asset Energy on September 5, 2024 and sell it today you would earn a total of 8.00 from holding First Asset Energy or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Manulife Smart International vs. First Asset Energy
Performance |
| Timeline |
| Manulife Smart Inter |
| First Asset Energy |
Manulife Smart and First Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Smart and First Asset
The main advantage of trading using opposite Manulife Smart and First Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Smart position performs unexpectedly, First Asset 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 First Asset will offset losses from the drop in First Asset's long position.| Manulife Smart vs. First Asset Energy | Manulife Smart vs. First Asset Tech | Manulife Smart vs. Harvest Equal Weight | Manulife Smart vs. CI Canada Lifeco |
| First Asset vs. CI Gold Giants | First Asset vs. First Asset Tech | First Asset vs. CI Canada Lifeco | First Asset vs. Harvest Healthcare Leaders |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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