Correlation Between McDonalds and TELUS
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By analyzing existing cross correlation between McDonalds and TELUS P 37, you can compare the effects of market volatilities on McDonalds and TELUS 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 McDonalds with a short position of TELUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of McDonalds and TELUS.
Diversification Opportunities for McDonalds and TELUS
Good diversification
The 3 months correlation between McDonalds and TELUS is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding McDonalds and TELUS P 37 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TELUS P 37 and McDonalds 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 McDonalds are associated (or correlated) with TELUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TELUS P 37 has no effect on the direction of McDonalds i.e., McDonalds and TELUS go up and down completely randomly.
Pair Corralation between McDonalds and TELUS
Considering the 90-day investment horizon McDonalds is expected to generate 2.18 times more return on investment than TELUS. However, McDonalds is 2.18 times more volatile than TELUS P 37. It trades about 0.16 of its potential returns per unit of risk. TELUS P 37 is currently generating about -0.35 per unit of risk. If you would invest 29,115 in McDonalds on November 29, 2024 and sell it today you would earn a total of 1,312 from holding McDonalds or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 47.62% |
| Values | Daily Returns |
McDonalds vs. TELUS P 37
Performance |
| Timeline |
| McDonalds |
| TELUS P 37 |
McDonalds and TELUS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with McDonalds and TELUS
The main advantage of trading using opposite McDonalds and TELUS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McDonalds position performs unexpectedly, TELUS 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 TELUS will offset losses from the drop in TELUS's long position.| McDonalds vs. Chipotle Mexican Grill | McDonalds vs. Yum Brands | McDonalds vs. The Wendys Co | McDonalds vs. Wingstop |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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