Correlation Between Ether Fund and Vanguard Canadian
Can any of the company-specific risk be diversified away by investing in both Ether Fund and Vanguard 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 Ether Fund and Vanguard Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ether Fund and Vanguard Canadian Short, you can compare the effects of market volatilities on Ether Fund and Vanguard 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 Ether Fund with a short position of Vanguard Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ether Fund and Vanguard Canadian.
Diversification Opportunities for Ether Fund and Vanguard Canadian
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ether and Vanguard is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ether Fund and Vanguard Canadian Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Canadian Short and Ether Fund 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 Ether Fund are associated (or correlated) with Vanguard Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Canadian Short has no effect on the direction of Ether Fund i.e., Ether Fund and Vanguard Canadian go up and down completely randomly.
Pair Corralation between Ether Fund and Vanguard Canadian
Assuming the 90 days trading horizon Ether Fund is expected to under-perform the Vanguard Canadian. In addition to that, Ether Fund is 25.47 times more volatile than Vanguard Canadian Short. It trades about -0.05 of its total potential returns per unit of risk. Vanguard Canadian Short is currently generating about 0.21 per unit of volatility. If you would invest 2,329 in Vanguard Canadian Short on November 2, 2024 and sell it today you would earn a total of 16.00 from holding Vanguard Canadian Short or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Ether Fund vs. Vanguard Canadian Short
Performance |
| Timeline |
| Ether Fund |
| Vanguard Canadian Short |
Ether Fund and Vanguard Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ether Fund and Vanguard Canadian
The main advantage of trading using opposite Ether Fund and Vanguard Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ether Fund position performs unexpectedly, Vanguard 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 Vanguard Canadian will offset losses from the drop in Vanguard Canadian's long position.| Ether Fund vs. iShares SPTSX 60 | Ether Fund vs. iShares Core SP | Ether Fund vs. iShares Core SPTSX | Ether Fund vs. BMO Aggregate Bond |
| Vanguard Canadian vs. Vanguard Canadian Short Term | Vanguard Canadian vs. Vanguard Canadian Aggregate | Vanguard Canadian vs. iShares Canadian Short | Vanguard Canadian vs. Vanguard FTSE Developed |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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