Correlation Between BMO NASDAQ and Harvest Global
Can any of the company-specific risk be diversified away by investing in both BMO NASDAQ and Harvest 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 BMO NASDAQ and Harvest Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BMO NASDAQ 100 and Harvest Global REIT, you can compare the effects of market volatilities on BMO NASDAQ and Harvest 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 BMO NASDAQ with a short position of Harvest Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of BMO NASDAQ and Harvest Global.
Diversification Opportunities for BMO NASDAQ and Harvest Global
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BMO and Harvest is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding BMO NASDAQ 100 and Harvest Global REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Global REIT and BMO NASDAQ 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 BMO NASDAQ 100 are associated (or correlated) with Harvest Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Global REIT has no effect on the direction of BMO NASDAQ i.e., BMO NASDAQ and Harvest Global go up and down completely randomly.
Pair Corralation between BMO NASDAQ and Harvest Global
Assuming the 90 days trading horizon BMO NASDAQ 100 is expected to generate 1.06 times more return on investment than Harvest Global. However, BMO NASDAQ is 1.06 times more volatile than Harvest Global REIT. It trades about 0.12 of its potential returns per unit of risk. Harvest Global REIT is currently generating about 0.03 per unit of risk. If you would invest 5,163 in BMO NASDAQ 100 on September 3, 2024 and sell it today you would earn a total of 4,331 from holding BMO NASDAQ 100 or generate 83.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BMO NASDAQ 100 vs. Harvest Global REIT
Performance |
| Timeline |
| BMO NASDAQ 100 |
| Harvest Global REIT |
BMO NASDAQ and Harvest Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BMO NASDAQ and Harvest Global
The main advantage of trading using opposite BMO NASDAQ and Harvest Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BMO NASDAQ position performs unexpectedly, Harvest 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 Harvest Global will offset losses from the drop in Harvest Global's long position.| BMO NASDAQ vs. Global X NASDAQ 100 | BMO NASDAQ vs. BMO NASDAQ 100 | BMO NASDAQ vs. BMO SP 500 | BMO NASDAQ vs. BMO MSCI USA |
| Harvest Global vs. Harvest Equal Weight | Harvest Global vs. Harvest Brand Leaders | Harvest Global vs. Energy Leaders Plus | Harvest Global vs. Harvest Tech Achievers |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |