Correlation Between Manulife Finl and AuQ Gold
Can any of the company-specific risk be diversified away by investing in both Manulife Finl and AuQ Gold 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 Finl and AuQ Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Finl Srs and AuQ Gold Mining, you can compare the effects of market volatilities on Manulife Finl and AuQ Gold 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 Finl with a short position of AuQ Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Finl and AuQ Gold.
Diversification Opportunities for Manulife Finl and AuQ Gold
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Manulife and AuQ is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Finl Srs and AuQ Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AuQ Gold Mining and Manulife Finl 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 Finl Srs are associated (or correlated) with AuQ Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AuQ Gold Mining has no effect on the direction of Manulife Finl i.e., Manulife Finl and AuQ Gold go up and down completely randomly.
Pair Corralation between Manulife Finl and AuQ Gold
Assuming the 90 days trading horizon Manulife Finl Srs is expected to generate 0.12 times more return on investment than AuQ Gold. However, Manulife Finl Srs is 8.68 times less risky than AuQ Gold. It trades about -0.03 of its potential returns per unit of risk. AuQ Gold Mining is currently generating about -0.07 per unit of risk. If you would invest 1,970 in Manulife Finl Srs on September 1, 2024 and sell it today you would lose (10.00) from holding Manulife Finl Srs or give up 0.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Manulife Finl Srs vs. AuQ Gold Mining
Performance |
| Timeline |
| Manulife Finl Srs |
| AuQ Gold Mining |
Manulife Finl and AuQ Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Finl and AuQ Gold
The main advantage of trading using opposite Manulife Finl and AuQ Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Finl position performs unexpectedly, AuQ Gold 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 AuQ Gold will offset losses from the drop in AuQ Gold's long position.| Manulife Finl vs. Manulife Financial Corp | Manulife Finl vs. Manulife Fin Non | Manulife Finl vs. Great West Lifeco | Manulife Finl vs. Great West Lifeco |
| AuQ Gold vs. Leons Furniture Limited | AuQ Gold vs. Mako Mining Corp | AuQ Gold vs. Doman Building Materials | AuQ Gold vs. Element Fleet Management |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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