Correlation Between NBI Unconstrained and CI Canadian
Can any of the company-specific risk be diversified away by investing in both NBI Unconstrained and CI Canadian 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 NBI Unconstrained and CI Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NBI Unconstrained Fixed and CI Canadian Short Term, you can compare the effects of market volatilities on NBI Unconstrained and CI Canadian 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 NBI Unconstrained with a short position of CI Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of NBI Unconstrained and CI Canadian.
Diversification Opportunities for NBI Unconstrained and CI Canadian
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between NBI and CAGS is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding NBI Unconstrained Fixed and CI Canadian Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Canadian Short and NBI Unconstrained 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 NBI Unconstrained Fixed are associated (or correlated) with CI Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Canadian Short has no effect on the direction of NBI Unconstrained i.e., NBI Unconstrained and CI Canadian go up and down completely randomly.
Pair Corralation between NBI Unconstrained and CI Canadian
Assuming the 90 days trading horizon NBI Unconstrained Fixed is expected to generate 2.43 times more return on investment than CI Canadian. However, NBI Unconstrained is 2.43 times more volatile than CI Canadian Short Term. It trades about 0.12 of its potential returns per unit of risk. CI Canadian Short Term is currently generating about 0.12 per unit of risk. If you would invest 2,101 in NBI Unconstrained Fixed on November 3, 2024 and sell it today you would earn a total of 24.00 from holding NBI Unconstrained Fixed or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NBI Unconstrained Fixed vs. CI Canadian Short Term
Performance |
| Timeline |
| NBI Unconstrained Fixed |
| CI Canadian Short |
NBI Unconstrained and CI Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NBI Unconstrained and CI Canadian
The main advantage of trading using opposite NBI Unconstrained and CI Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NBI Unconstrained position performs unexpectedly, CI Canadian 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 CI Canadian will offset losses from the drop in CI Canadian's long position.| NBI Unconstrained vs. NBI High Yield | NBI Unconstrained vs. NBI Active Canadian | NBI Unconstrained vs. Picton Mahoney Fortified | NBI Unconstrained vs. NBI Liquid Alternatives |
| CI Canadian vs. NBI High Yield | CI Canadian vs. NBI Unconstrained Fixed | CI Canadian vs. Mackenzie Developed ex North | CI Canadian vs. BMO Short Term Bond |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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