Correlation Between IShares Floating and Manulife Multifactor
Can any of the company-specific risk be diversified away by investing in both IShares Floating and Manulife Multifactor 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 IShares Floating and Manulife Multifactor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Floating Rate and Manulife Multifactor Mid, you can compare the effects of market volatilities on IShares Floating and Manulife Multifactor 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 IShares Floating with a short position of Manulife Multifactor. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Floating and Manulife Multifactor.
Diversification Opportunities for IShares Floating and Manulife Multifactor
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Manulife is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding iShares Floating Rate and Manulife Multifactor Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Multifactor Mid and IShares Floating 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 iShares Floating Rate are associated (or correlated) with Manulife Multifactor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Multifactor Mid has no effect on the direction of IShares Floating i.e., IShares Floating and Manulife Multifactor go up and down completely randomly.
Pair Corralation between IShares Floating and Manulife Multifactor
Assuming the 90 days trading horizon iShares Floating Rate is expected to generate 0.07 times more return on investment than Manulife Multifactor. However, iShares Floating Rate is 13.7 times less risky than Manulife Multifactor. It trades about 0.29 of its potential returns per unit of risk. Manulife Multifactor Mid is currently generating about -0.25 per unit of risk. If you would invest 1,996 in iShares Floating Rate on November 29, 2024 and sell it today you would earn a total of 7.00 from holding iShares Floating Rate or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Floating Rate vs. Manulife Multifactor Mid
Performance |
| Timeline |
| iShares Floating Rate |
| Manulife Multifactor Mid |
IShares Floating and Manulife Multifactor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Floating and Manulife Multifactor
The main advantage of trading using opposite IShares Floating and Manulife Multifactor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Floating position performs unexpectedly, Manulife Multifactor 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 Multifactor will offset losses from the drop in Manulife Multifactor's long position.| IShares Floating vs. iShares 1 10Yr Laddered | IShares Floating vs. iShares JP Morgan | IShares Floating vs. iShares Convertible Bond | IShares Floating vs. iShares IG 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |