Correlation Between CI Canadian and Hamilton REITs
Can any of the company-specific risk be diversified away by investing in both CI Canadian and Hamilton REITs 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 CI Canadian and Hamilton REITs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CI Canadian REIT and Hamilton REITs YIELD, you can compare the effects of market volatilities on CI Canadian and Hamilton REITs 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 CI Canadian with a short position of Hamilton REITs. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Canadian and Hamilton REITs.
Diversification Opportunities for CI Canadian and Hamilton REITs
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between RIT and Hamilton is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding CI Canadian REIT and Hamilton REITs YIELD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton REITs YIELD and CI Canadian 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 CI Canadian REIT are associated (or correlated) with Hamilton REITs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton REITs YIELD has no effect on the direction of CI Canadian i.e., CI Canadian and Hamilton REITs go up and down completely randomly.
Pair Corralation between CI Canadian and Hamilton REITs
Assuming the 90 days trading horizon CI Canadian is expected to generate 16.14 times less return on investment than Hamilton REITs. In addition to that, CI Canadian is 1.31 times more volatile than Hamilton REITs YIELD. It trades about 0.01 of its total potential returns per unit of risk. Hamilton REITs YIELD is currently generating about 0.19 per unit of volatility. If you would invest 1,551 in Hamilton REITs YIELD on August 27, 2024 and sell it today you would earn a total of 242.00 from holding Hamilton REITs YIELD or generate 15.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 24.01% |
| Values | Daily Returns |
CI Canadian REIT vs. Hamilton REITs YIELD
Performance |
| Timeline |
| CI Canadian REIT |
| Hamilton REITs YIELD |
CI Canadian and Hamilton REITs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Canadian and Hamilton REITs
The main advantage of trading using opposite CI Canadian and Hamilton REITs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Canadian position performs unexpectedly, Hamilton REITs 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 Hamilton REITs will offset losses from the drop in Hamilton REITs' long position.| CI Canadian vs. iShares SPTSX Capped | CI Canadian vs. iShares Canadian Select | CI Canadian vs. iShares SPTSX Capped | CI Canadian vs. iShares Diversified Monthly |
| Hamilton REITs vs. Hamilton Equity Yield | Hamilton REITs vs. Hamilton Enhanced Canadian | Hamilton REITs vs. Hamilton Australian Bank | Hamilton REITs vs. Hamilton MidSmall Cap Financials |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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