Correlation Between BMO Aggregate and Stelmine Canada
Can any of the company-specific risk be diversified away by investing in both BMO Aggregate and Stelmine Canada 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 Aggregate and Stelmine Canada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BMO Aggregate Bond and Stelmine Canada, you can compare the effects of market volatilities on BMO Aggregate and Stelmine Canada 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 Aggregate with a short position of Stelmine Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of BMO Aggregate and Stelmine Canada.
Diversification Opportunities for BMO Aggregate and Stelmine Canada
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BMO and Stelmine is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding BMO Aggregate Bond and Stelmine Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stelmine Canada and BMO Aggregate 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 Aggregate Bond are associated (or correlated) with Stelmine Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stelmine Canada has no effect on the direction of BMO Aggregate i.e., BMO Aggregate and Stelmine Canada go up and down completely randomly.
Pair Corralation between BMO Aggregate and Stelmine Canada
If you would invest 2,983 in BMO Aggregate Bond on October 24, 2024 and sell it today you would earn a total of 7.00 from holding BMO Aggregate Bond or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BMO Aggregate Bond vs. Stelmine Canada
Performance |
| Timeline |
| BMO Aggregate Bond |
| Stelmine Canada |
BMO Aggregate and Stelmine Canada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BMO Aggregate and Stelmine Canada
The main advantage of trading using opposite BMO Aggregate and Stelmine Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BMO Aggregate position performs unexpectedly, Stelmine Canada 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 Stelmine Canada will offset losses from the drop in Stelmine Canada's long position.| BMO Aggregate vs. BMO Short Term Bond | BMO Aggregate vs. BMO Canadian Bank | BMO Aggregate vs. BMO Aggregate Bond | BMO Aggregate vs. BMO Balanced ETF |
| Stelmine Canada vs. Galantas Gold Corp | Stelmine Canada vs. CANEX Metals | Stelmine Canada vs. Themac Resources Group | Stelmine Canada vs. Magna Terra Minerals |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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