Correlation Between Manulife Finl and CT Real
Can any of the company-specific risk be diversified away by investing in both Manulife Finl and CT Real 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 CT Real 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 CT Real Estate, you can compare the effects of market volatilities on Manulife Finl and CT Real 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 CT Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Finl and CT Real.
Diversification Opportunities for Manulife Finl and CT Real
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Manulife and CRT-UN is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Finl Srs and CT Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CT Real Estate 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 CT Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CT Real Estate has no effect on the direction of Manulife Finl i.e., Manulife Finl and CT Real go up and down completely randomly.
Pair Corralation between Manulife Finl and CT Real
Assuming the 90 days trading horizon Manulife Finl Srs is expected to generate 0.61 times more return on investment than CT Real. However, Manulife Finl Srs is 1.65 times less risky than CT Real. It trades about 0.41 of its potential returns per unit of risk. CT Real Estate is currently generating about 0.11 per unit of risk. If you would invest 1,992 in Manulife Finl Srs on November 27, 2024 and sell it today you would earn a total of 128.00 from holding Manulife Finl Srs or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manulife Finl Srs vs. CT Real Estate
Performance |
| Timeline |
| Manulife Finl Srs |
| CT Real Estate |
Manulife Finl and CT Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Finl and CT Real
The main advantage of trading using opposite Manulife Finl and CT Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Finl position performs unexpectedly, CT Real 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 CT Real will offset losses from the drop in CT Real's long position.| Manulife Finl vs. SPoT Coffee | Manulife Finl vs. Toronto Dominion Bank Pref | Manulife Finl vs. Boat Rocker Media | Manulife Finl vs. VIP Entertainment Technologies |
| CT Real vs. Choice Properties Real | CT Real vs. Crombie Real Estate | CT Real vs. Granite Real Estate | CT Real vs. Allied Properties Real |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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