Correlation Between Manulife Finl and Willow Biosciences
Can any of the company-specific risk be diversified away by investing in both Manulife Finl and Willow Biosciences 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 Willow Biosciences 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 Willow Biosciences, you can compare the effects of market volatilities on Manulife Finl and Willow Biosciences 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 Willow Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Finl and Willow Biosciences.
Diversification Opportunities for Manulife Finl and Willow Biosciences
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Manulife and Willow is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Finl Srs and Willow Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willow Biosciences 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 Willow Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willow Biosciences has no effect on the direction of Manulife Finl i.e., Manulife Finl and Willow Biosciences go up and down completely randomly.
Pair Corralation between Manulife Finl and Willow Biosciences
Assuming the 90 days trading horizon Manulife Finl Srs is expected to generate 0.06 times more return on investment than Willow Biosciences. However, Manulife Finl Srs is 16.05 times less risky than Willow Biosciences. It trades about 0.14 of its potential returns per unit of risk. Willow Biosciences is currently generating about -0.04 per unit of risk. If you would invest 1,980 in Manulife Finl Srs on October 24, 2024 and sell it today you would earn a total of 42.00 from holding Manulife Finl Srs or generate 2.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Manulife Finl Srs vs. Willow Biosciences
Performance |
| Timeline |
| Manulife Finl Srs |
| Willow Biosciences |
Manulife Finl and Willow Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Finl and Willow Biosciences
The main advantage of trading using opposite Manulife Finl and Willow Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Finl position performs unexpectedly, Willow Biosciences 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 Willow Biosciences will offset losses from the drop in Willow Biosciences' long position.| Manulife Finl vs. Western Investment | Manulife Finl vs. Millennium Silver Corp | Manulife Finl vs. Monument Mining Limited | Manulife Finl vs. Aya Gold Silver |
| Willow Biosciences vs. Medipharm Labs Corp | Willow Biosciences vs. Cardiol Therapeutics Class | Willow Biosciences vs. StageZero Life Sciences |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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