Correlation Between IShares Canadian and Mackenzie Global
Can any of the company-specific risk be diversified away by investing in both IShares Canadian and Mackenzie Global 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 Mackenzie Global 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 Mackenzie Global Sustainable, you can compare the effects of market volatilities on IShares Canadian and Mackenzie Global 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 Mackenzie Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Canadian and Mackenzie Global.
Diversification Opportunities for IShares Canadian and Mackenzie Global
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and Mackenzie is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding iShares Canadian HYBrid and Mackenzie Global Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackenzie Global Sus 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 Mackenzie Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackenzie Global Sus has no effect on the direction of IShares Canadian i.e., IShares Canadian and Mackenzie Global go up and down completely randomly.
Pair Corralation between IShares Canadian and Mackenzie Global
Assuming the 90 days trading horizon IShares Canadian is expected to generate 2.02 times less return on investment than Mackenzie Global. But when comparing it to its historical volatility, iShares Canadian HYBrid is 2.62 times less risky than Mackenzie Global. It trades about 0.23 of its potential returns per unit of risk. Mackenzie Global Sustainable is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 2,617 in Mackenzie Global Sustainable on September 1, 2024 and sell it today you would earn a total of 83.00 from holding Mackenzie Global Sustainable or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.36% |
| Values | Daily Returns |
iShares Canadian HYBrid vs. Mackenzie Global Sustainable
Performance |
| Timeline |
| iShares Canadian HYBrid |
| Mackenzie Global Sus |
IShares Canadian and Mackenzie Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Canadian and Mackenzie Global
The main advantage of trading using opposite IShares Canadian and Mackenzie Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Canadian position performs unexpectedly, Mackenzie Global 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 Mackenzie Global will offset losses from the drop in Mackenzie Global's long position.| IShares Canadian vs. Global X Active | IShares Canadian vs. Brompton Flaherty Crumrine | IShares Canadian vs. CIBC Core Fixed | IShares Canadian vs. BMO Aggregate Bond |
| Mackenzie Global vs. Mackenzie Developed ex North | Mackenzie Global vs. Mackenzie Aggregate Bond | Mackenzie Global vs. Mackenzie Canadian Ultra | Mackenzie Global vs. Mackenzie TIPS Index |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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