Correlation Between RBC Quant and IShares Canadian
Can any of the company-specific risk be diversified away by investing in both RBC Quant and IShares 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 RBC Quant and IShares Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RBC Quant Canadian and iShares Canadian Select, you can compare the effects of market volatilities on RBC Quant and IShares 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 RBC Quant with a short position of IShares Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBC Quant and IShares Canadian.
Diversification Opportunities for RBC Quant and IShares Canadian
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between RBC and IShares is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding RBC Quant Canadian and iShares Canadian Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Canadian Select and RBC Quant 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 RBC Quant Canadian are associated (or correlated) with IShares Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Canadian Select has no effect on the direction of RBC Quant i.e., RBC Quant and IShares Canadian go up and down completely randomly.
Pair Corralation between RBC Quant and IShares Canadian
Assuming the 90 days trading horizon RBC Quant Canadian is expected to generate 1.01 times more return on investment than IShares Canadian. However, RBC Quant is 1.01 times more volatile than iShares Canadian Select. It trades about 0.12 of its potential returns per unit of risk. iShares Canadian Select is currently generating about 0.11 per unit of risk. If you would invest 2,261 in RBC Quant Canadian on September 1, 2024 and sell it today you would earn a total of 748.00 from holding RBC Quant Canadian or generate 33.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
RBC Quant Canadian vs. iShares Canadian Select
Performance |
| Timeline |
| RBC Quant Canadian |
| iShares Canadian Select |
RBC Quant and IShares Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RBC Quant and IShares Canadian
The main advantage of trading using opposite RBC Quant and IShares Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RBC Quant position performs unexpectedly, IShares 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 IShares Canadian will offset losses from the drop in IShares Canadian's long position.| RBC Quant vs. RBC Quant Dividend | RBC Quant vs. RBC Quant EAFE | RBC Quant vs. Invesco Canadian Dividend | RBC Quant vs. RBC Canadian Preferred |
| IShares Canadian vs. Vanguard FTSE Canadian | IShares Canadian vs. Vanguard SP 500 | IShares Canadian vs. iShares Core SPTSX |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |