Correlation Between Manulife Financial and Real Estate
Can any of the company-specific risk be diversified away by investing in both Manulife Financial and Real Estate 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 Financial and Real Estate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Financial Corp and Real Estate E Commerce, you can compare the effects of market volatilities on Manulife Financial and Real Estate 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 Financial with a short position of Real Estate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Financial and Real Estate.
Diversification Opportunities for Manulife Financial and Real Estate
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Manulife and Real is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Financial Corp and Real Estate E Commerce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Estate E and Manulife Financial 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 Financial Corp are associated (or correlated) with Real Estate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Estate E has no effect on the direction of Manulife Financial i.e., Manulife Financial and Real Estate go up and down completely randomly.
Pair Corralation between Manulife Financial and Real Estate
Assuming the 90 days trading horizon Manulife Financial Corp is expected to generate 1.12 times more return on investment than Real Estate. However, Manulife Financial is 1.12 times more volatile than Real Estate E Commerce. It trades about 0.03 of its potential returns per unit of risk. Real Estate E Commerce is currently generating about 0.01 per unit of risk. If you would invest 4,403 in Manulife Financial Corp on October 24, 2024 and sell it today you would earn a total of 20.00 from holding Manulife Financial Corp or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manulife Financial Corp vs. Real Estate E Commerce
Performance |
| Timeline |
| Manulife Financial Corp |
| Real Estate E |
Manulife Financial and Real Estate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Financial and Real Estate
The main advantage of trading using opposite Manulife Financial and Real Estate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Financial position performs unexpectedly, Real Estate 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 Real Estate will offset losses from the drop in Real Estate's long position.| Manulife Financial vs. Bank of Nova | Manulife Financial vs. Sun Life Financial | Manulife Financial vs. Toronto Dominion Bank | Manulife Financial vs. Royal Bank of |
| Real Estate vs. Global Dividend Growth | Real Estate vs. E Split Corp | Real Estate vs. Brompton Split Banc | Real Estate vs. Life Banc Split |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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