Correlation Between Mackenzie Floating and Desjardins
Can any of the company-specific risk be diversified away by investing in both Mackenzie Floating and Desjardins 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 Mackenzie Floating and Desjardins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mackenzie Floating Rate and Desjardins RI Developed, you can compare the effects of market volatilities on Mackenzie Floating and Desjardins 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 Mackenzie Floating with a short position of Desjardins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mackenzie Floating and Desjardins.
Diversification Opportunities for Mackenzie Floating and Desjardins
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mackenzie and Desjardins is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Mackenzie Floating Rate and Desjardins RI Developed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Desjardins RI Developed and Mackenzie Floating 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 Mackenzie Floating Rate are associated (or correlated) with Desjardins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Desjardins RI Developed has no effect on the direction of Mackenzie Floating i.e., Mackenzie Floating and Desjardins go up and down completely randomly.
Pair Corralation between Mackenzie Floating and Desjardins
Assuming the 90 days trading horizon Mackenzie Floating Rate is expected to generate 0.24 times more return on investment than Desjardins. However, Mackenzie Floating Rate is 4.2 times less risky than Desjardins. It trades about 0.15 of its potential returns per unit of risk. Desjardins RI Developed is currently generating about 0.02 per unit of risk. If you would invest 1,514 in Mackenzie Floating Rate on September 12, 2024 and sell it today you would earn a total of 205.00 from holding Mackenzie Floating Rate or generate 13.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 75.5% |
| Values | Daily Returns |
Mackenzie Floating Rate vs. Desjardins RI Developed
Performance |
| Timeline |
| Mackenzie Floating Rate |
| Desjardins RI Developed |
Mackenzie Floating and Desjardins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mackenzie Floating and Desjardins
The main advantage of trading using opposite Mackenzie Floating and Desjardins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mackenzie Floating position performs unexpectedly, Desjardins 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 Desjardins will offset losses from the drop in Desjardins' long position.| Mackenzie Floating vs. Mackenzie Developed ex North | Mackenzie Floating vs. Mackenzie Global Sustainable | Mackenzie Floating vs. Mackenzie Aggregate Bond | Mackenzie Floating vs. Mackenzie Canadian Ultra |
| Desjardins vs. Desjardins RI USA | Desjardins vs. Desjardins RI Canada | Desjardins vs. Desjardins RI Developed | Desjardins vs. Desjardins RI Global |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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