Correlation Between IShares Canadian and Aptose Biosciences
Can any of the company-specific risk be diversified away by investing in both IShares Canadian and Aptose Biosciences 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 Canadian and Aptose Biosciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Canadian HYBrid and Aptose Biosciences, you can compare the effects of market volatilities on IShares Canadian and Aptose Biosciences 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 Canadian with a short position of Aptose Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Canadian and Aptose Biosciences.
Diversification Opportunities for IShares Canadian and Aptose Biosciences
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between IShares and Aptose is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding iShares Canadian HYBrid and Aptose Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptose Biosciences and IShares 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 iShares Canadian HYBrid are associated (or correlated) with Aptose Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptose Biosciences has no effect on the direction of IShares Canadian i.e., IShares Canadian and Aptose Biosciences go up and down completely randomly.
Pair Corralation between IShares Canadian and Aptose Biosciences
Assuming the 90 days trading horizon iShares Canadian HYBrid is expected to generate 0.03 times more return on investment than Aptose Biosciences. However, iShares Canadian HYBrid is 30.37 times less risky than Aptose Biosciences. It trades about 0.01 of its potential returns per unit of risk. Aptose Biosciences is currently generating about -0.38 per unit of risk. If you would invest 1,953 in iShares Canadian HYBrid on August 25, 2024 and sell it today you would earn a total of 1.00 from holding iShares Canadian HYBrid or generate 0.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Canadian HYBrid vs. Aptose Biosciences
Performance |
| Timeline |
| iShares Canadian HYBrid |
| Aptose Biosciences |
IShares Canadian and Aptose Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Canadian and Aptose Biosciences
The main advantage of trading using opposite IShares Canadian and Aptose Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Canadian position performs unexpectedly, Aptose Biosciences 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 Aptose Biosciences will offset losses from the drop in Aptose Biosciences' long position.| IShares Canadian vs. iShares IG Corporate | IShares Canadian vs. iShares High Yield | IShares Canadian vs. iShares Floating Rate | IShares Canadian vs. iShares JP Morgan |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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