Correlation Between Partners Value and Manulife Financial
Can any of the company-specific risk be diversified away by investing in both Partners Value and Manulife Financial 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 Partners Value and Manulife Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Partners Value Investments and Manulife Financial Corp, you can compare the effects of market volatilities on Partners Value and Manulife Financial 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 Partners Value with a short position of Manulife Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Partners Value and Manulife Financial.
Diversification Opportunities for Partners Value and Manulife Financial
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Partners and Manulife is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Partners Value Investments and Manulife Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Financial Corp and Partners Value 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 Partners Value Investments are associated (or correlated) with Manulife Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Financial Corp has no effect on the direction of Partners Value i.e., Partners Value and Manulife Financial go up and down completely randomly.
Pair Corralation between Partners Value and Manulife Financial
Assuming the 90 days trading horizon Partners Value is expected to generate 1.02 times less return on investment than Manulife Financial. In addition to that, Partners Value is 2.23 times more volatile than Manulife Financial Corp. It trades about 0.09 of its total potential returns per unit of risk. Manulife Financial Corp is currently generating about 0.2 per unit of volatility. If you would invest 1,651 in Manulife Financial Corp on October 26, 2024 and sell it today you would earn a total of 219.00 from holding Manulife Financial Corp or generate 13.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Partners Value Investments vs. Manulife Financial Corp
Performance |
| Timeline |
| Partners Value Inves |
| Manulife Financial Corp |
Partners Value and Manulife Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Partners Value and Manulife Financial
The main advantage of trading using opposite Partners Value and Manulife Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Partners Value position performs unexpectedly, Manulife Financial 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 Manulife Financial will offset losses from the drop in Manulife Financial's long position.| Partners Value vs. High Liner Foods | Partners Value vs. Tree Island Steel | Partners Value vs. NextSource Materials | Partners Value vs. TGS Esports |
| Manulife Financial vs. Prime Dividend Corp | Manulife Financial vs. Canadian Life Companies | Manulife Financial vs. Financial 15 Split | Manulife Financial vs. Dividend 15 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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