Correlation Between IShares SPTSX and CI First
Can any of the company-specific risk be diversified away by investing in both IShares SPTSX and CI First 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 SPTSX and CI First into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares SPTSX Completion and CI First Asset, you can compare the effects of market volatilities on IShares SPTSX and CI First 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 SPTSX with a short position of CI First. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SPTSX and CI First.
Diversification Opportunities for IShares SPTSX and CI First
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and MXF is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding iShares SPTSX Completion and CI First Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI First Asset and IShares SPTSX 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 SPTSX Completion are associated (or correlated) with CI First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI First Asset has no effect on the direction of IShares SPTSX i.e., IShares SPTSX and CI First go up and down completely randomly.
Pair Corralation between IShares SPTSX and CI First
Assuming the 90 days trading horizon iShares SPTSX Completion is expected to generate 0.34 times more return on investment than CI First. However, iShares SPTSX Completion is 2.96 times less risky than CI First. It trades about 0.22 of its potential returns per unit of risk. CI First Asset is currently generating about -0.16 per unit of risk. If you would invest 3,804 in iShares SPTSX Completion on August 28, 2024 and sell it today you would earn a total of 128.00 from holding iShares SPTSX Completion or generate 3.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares SPTSX Completion vs. CI First Asset
Performance |
| Timeline |
| iShares SPTSX Completion |
| CI First Asset |
IShares SPTSX and CI First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares SPTSX and CI First
The main advantage of trading using opposite IShares SPTSX and CI First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares SPTSX position performs unexpectedly, CI First 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 CI First will offset losses from the drop in CI First's long position.| IShares SPTSX vs. iShares MSCI EAFE | IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares Canadian Real | IShares SPTSX vs. iShares Canadian Value |
| CI First vs. iShares SPTSX Completion | CI First vs. iShares SPTSX Capped | CI First vs. iShares MSCI EAFE | CI First vs. iShares Diversified Monthly |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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