Correlation Between Vanguard FTSE and Manulife Smart
Can any of the company-specific risk be diversified away by investing in both Vanguard FTSE and Manulife Smart 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 Vanguard FTSE and Manulife Smart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard FTSE Emerging and Manulife Smart Dividend, you can compare the effects of market volatilities on Vanguard FTSE and Manulife Smart 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 Vanguard FTSE with a short position of Manulife Smart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard FTSE and Manulife Smart.
Diversification Opportunities for Vanguard FTSE and Manulife Smart
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Manulife is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard FTSE Emerging and Manulife Smart Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Smart Dividend and Vanguard FTSE 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 Vanguard FTSE Emerging are associated (or correlated) with Manulife Smart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Smart Dividend has no effect on the direction of Vanguard FTSE i.e., Vanguard FTSE and Manulife Smart go up and down completely randomly.
Pair Corralation between Vanguard FTSE and Manulife Smart
Assuming the 90 days trading horizon Vanguard FTSE is expected to generate 1.05 times less return on investment than Manulife Smart. In addition to that, Vanguard FTSE is 1.11 times more volatile than Manulife Smart Dividend. It trades about 0.1 of its total potential returns per unit of risk. Manulife Smart Dividend is currently generating about 0.11 per unit of volatility. If you would invest 1,155 in Manulife Smart Dividend on September 3, 2024 and sell it today you would earn a total of 252.00 from holding Manulife Smart Dividend or generate 21.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard FTSE Emerging vs. Manulife Smart Dividend
Performance |
| Timeline |
| Vanguard FTSE Emerging |
| Manulife Smart Dividend |
Vanguard FTSE and Manulife Smart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard FTSE and Manulife Smart
The main advantage of trading using opposite Vanguard FTSE and Manulife Smart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard FTSE position performs unexpectedly, Manulife Smart 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 Smart will offset losses from the drop in Manulife Smart's long position.| Vanguard FTSE vs. RBC Quant European | Vanguard FTSE vs. RBC Quant Canadian | Vanguard FTSE vs. RBC Quant EAFE | Vanguard FTSE vs. RBC Quant Dividend |
| Manulife Smart vs. Manulife Multifactor Mid | Manulife Smart vs. Manulife Smart International | Manulife Smart vs. Manulife Smart Short Term | Manulife Smart vs. Manulife Smart Corporate |
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 CEOs Directory module to screen CEOs from public companies around the world.
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