Correlation Between Evolve Active and CI Preferred

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

By analyzing existing cross correlation between Evolve Active Canadian and CI Preferred Share, you can compare the effects of market volatilities on Evolve Active and CI Preferred 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 Evolve Active with a short position of CI Preferred. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolve Active and CI Preferred.

Diversification Opportunities for Evolve Active and CI Preferred

0.98

Correlation Coefficient

Evolve Active  CI Preferred

Almost no diversification

The 3 months correlation between Evolve and FPR is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Active Canadian and CI Preferred Share in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Preferred Share and Evolve Active 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 Evolve Active Canadian are associated (or correlated) with CI Preferred. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Preferred Share has no effect on the direction of Evolve Active i.e., Evolve Active and CI Preferred go up and down completely randomly.

Pair Corralation between Evolve Active and CI Preferred

Assuming the 90 days trading horizon Evolve Active is expected to generate 1.13 times less return on investment than CI Preferred. But when comparing it to its historical volatility, Evolve Active Canadian is 1.37 times less risky than CI Preferred. It trades about 0.41 of its potential returns per unit of risk. CI Preferred Share is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  2,206  in CI Preferred Share on April 22, 2025 and sell it today you would earn a total of  229.00  from holding CI Preferred Share or generate 10.38% return on investment over 90 days.

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

Evolve Active Canadian  vs.  CI Preferred Share

Evolve Active Canadian

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Evolve Active Canadian are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Evolve Active may actually be approaching a critical reversion point that can send shares even higher in August 2025.

CI Preferred Share

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in CI Preferred Share are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, CI Preferred may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Evolve Active and CI Preferred

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

The idea behind Evolve Active Canadian and CI Preferred Share 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.