Correlation Between Pembina Pipeline and BMO Aggregate
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By analyzing existing cross correlation between Pembina Pipeline Corp and BMO Aggregate Bond, you can compare the effects of market volatilities on Pembina Pipeline and BMO Aggregate 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 Pembina Pipeline with a short position of BMO Aggregate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and BMO Aggregate.
Diversification Opportunities for Pembina Pipeline and BMO Aggregate
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pembina and BMO is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and BMO Aggregate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO Aggregate Bond and Pembina Pipeline 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 Pembina Pipeline Corp are associated (or correlated) with BMO Aggregate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO Aggregate Bond has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and BMO Aggregate go up and down completely randomly.
Pair Corralation between Pembina Pipeline and BMO Aggregate
Assuming the 90 days trading horizon Pembina Pipeline is expected to generate 6.7 times less return on investment than BMO Aggregate. In addition to that, Pembina Pipeline is 1.21 times more volatile than BMO Aggregate Bond. It trades about 0.01 of its total potential returns per unit of risk. BMO Aggregate Bond is currently generating about 0.08 per unit of volatility. If you would invest 3,009 in BMO Aggregate Bond on December 10, 2024 and sell it today you would earn a total of 22.00 from holding BMO Aggregate Bond or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pembina Pipeline Corp vs. BMO Aggregate Bond
Performance |
| Timeline |
| Pembina Pipeline Corp |
| BMO Aggregate Bond |
Pembina Pipeline and BMO Aggregate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pembina Pipeline and BMO Aggregate
The main advantage of trading using opposite Pembina Pipeline and BMO Aggregate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pembina Pipeline position performs unexpectedly, BMO Aggregate 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 BMO Aggregate will offset losses from the drop in BMO Aggregate's long position.| Pembina Pipeline vs. DIRTT Environmental Solutions | Pembina Pipeline vs. Canlan Ice Sports | Pembina Pipeline vs. Costco Wholesale Corp | Pembina Pipeline vs. Chemtrade Logistics Income |
| BMO Aggregate vs. BMO Short Term Bond | BMO Aggregate vs. BMO Canadian Bank | BMO Aggregate vs. BMO Aggregate Bond | BMO Aggregate vs. BMO Balanced ETF |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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