Correlation Between Enbridge Pref and Manulife Multifactor
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By analyzing existing cross correlation between Enbridge Pref 5 and Manulife Multifactor Developed, you can compare the effects of market volatilities on Enbridge Pref and Manulife Multifactor 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 Enbridge Pref with a short position of Manulife Multifactor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Manulife Multifactor.
Diversification Opportunities for Enbridge Pref and Manulife Multifactor
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Enbridge and Manulife is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and Manulife Multifactor Developed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manulife Multifactor and Enbridge Pref 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 Enbridge Pref 5 are associated (or correlated) with Manulife Multifactor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manulife Multifactor has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Manulife Multifactor go up and down completely randomly.
Pair Corralation between Enbridge Pref and Manulife Multifactor
Assuming the 90 days trading horizon Enbridge Pref 5 is expected to under-perform the Manulife Multifactor. But the preferred stock apears to be less risky and, when comparing its historical volatility, Enbridge Pref 5 is 1.16 times less risky than Manulife Multifactor. The preferred stock trades about -0.13 of its potential returns per unit of risk. The Manulife Multifactor Developed is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,869 in Manulife Multifactor Developed on March 11, 2024 and sell it today you would earn a total of 37.00 from holding Manulife Multifactor Developed or generate 0.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Enbridge Pref 5 vs. Manulife Multifactor Developed
Performance |
Timeline |
Enbridge Pref 5 |
Manulife Multifactor |
Enbridge Pref and Manulife Multifactor Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Enbridge Pref and Manulife Multifactor
The main advantage of trading using opposite Enbridge Pref and Manulife Multifactor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Manulife Multifactor 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 Manulife Multifactor will offset losses from the drop in Manulife Multifactor's long position.Enbridge Pref vs. Enbridge Pref 11 | Enbridge Pref vs. Enbridge Pref L | Enbridge Pref vs. E Split Corp | Enbridge Pref vs. E Split Corp |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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