Correlation Between CIBC Flexible and CIBC International

Can any of the company-specific risk be diversified away by investing in both CIBC Flexible and CIBC International 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 CIBC Flexible and CIBC International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CIBC Flexible Yield and CIBC International Equity, you can compare the effects of market volatilities on CIBC Flexible and CIBC International 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 CIBC Flexible with a short position of CIBC International. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIBC Flexible and CIBC International.

Diversification Opportunities for CIBC Flexible and CIBC International

0.69

Correlation Coefficient

CIBC Flexible  CIBC International

Poor diversification

The 3 months correlation between CIBC and CIBC is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding CIBC Flexible Yield and CIBC International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIBC International Equity and CIBC Flexible 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 CIBC Flexible Yield are associated (or correlated) with CIBC International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIBC International Equity has no effect on the direction of CIBC Flexible i.e., CIBC Flexible and CIBC International go up and down completely randomly.

Pair Corralation between CIBC Flexible and CIBC International

Assuming the 90 days trading horizon CIBC Flexible is expected to generate 5.98 times less return on investment than CIBC International. But when comparing it to its historical volatility, CIBC Flexible Yield is 4.58 times less risky than CIBC International. It trades about 0.15 of its potential returns per unit of risk. CIBC International Equity is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  2,302  in CIBC International Equity on April 22, 2025 and sell it today you would earn a total of  57.00  from holding CIBC International Equity or generate 2.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

CIBC Flexible Yield  vs.  CIBC International Equity

CIBC Flexible Yield

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CIBC Flexible Yield are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, CIBC Flexible is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

CIBC International Equity

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CIBC International Equity are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, CIBC International may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CIBC Flexible and CIBC International

The main advantage of trading using opposite CIBC Flexible and CIBC International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIBC Flexible position performs unexpectedly, CIBC International 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 CIBC International will offset losses from the drop in CIBC International's long position.

The idea behind CIBC Flexible Yield and CIBC International Equity pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.