Correlation Between Manulife Smart and IShares Canadian
Can any of the company-specific risk be diversified away by investing in both Manulife Smart 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 Manulife Smart and IShares Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manulife Smart Short Term and iShares Canadian Universe, you can compare the effects of market volatilities on Manulife Smart 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 Manulife Smart with a short position of IShares Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manulife Smart and IShares Canadian.
Diversification Opportunities for Manulife Smart and IShares Canadian
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Manulife and IShares is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Manulife Smart Short Term and iShares Canadian Universe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Canadian Universe and Manulife Smart 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 Manulife Smart Short Term 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 Universe has no effect on the direction of Manulife Smart i.e., Manulife Smart and IShares Canadian go up and down completely randomly.
Pair Corralation between Manulife Smart and IShares Canadian
Assuming the 90 days trading horizon Manulife Smart Short Term is expected to generate 0.48 times more return on investment than IShares Canadian. However, Manulife Smart Short Term is 2.07 times less risky than IShares Canadian. It trades about 0.13 of its potential returns per unit of risk. iShares Canadian Universe is currently generating about 0.05 per unit of risk. If you would invest 850.00 in Manulife Smart Short Term on September 12, 2024 and sell it today you would earn a total of 122.00 from holding Manulife Smart Short Term or generate 14.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manulife Smart Short Term vs. iShares Canadian Universe
Performance |
| Timeline |
| Manulife Smart Short |
| iShares Canadian Universe |
Manulife Smart and IShares Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manulife Smart and IShares Canadian
The main advantage of trading using opposite Manulife Smart and IShares Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manulife Smart 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.| Manulife Smart vs. iShares Canadian Universe | Manulife Smart vs. iShares Canadian Real | Manulife Smart vs. iShares Core Canadian | Manulife Smart vs. iShares Core Canadian |
| IShares Canadian vs. iShares Canadian Short | IShares Canadian vs. iShares MSCI EAFE | IShares Canadian vs. iShares Core Canadian | IShares Canadian vs. iShares Canadian Real |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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