Correlation Between Costco Wholesale and IShares Physical
Can any of the company-specific risk be diversified away by investing in both Costco Wholesale and IShares Physical 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 Costco Wholesale and IShares Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Costco Wholesale Corp and iShares Physical Silver, you can compare the effects of market volatilities on Costco Wholesale and IShares Physical 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 Costco Wholesale with a short position of IShares Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costco Wholesale and IShares Physical.
Diversification Opportunities for Costco Wholesale and IShares Physical
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Costco and IShares is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Costco Wholesale Corp and iShares Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Physical Silver and Costco Wholesale 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 Costco Wholesale Corp are associated (or correlated) with IShares Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Physical Silver has no effect on the direction of Costco Wholesale i.e., Costco Wholesale and IShares Physical go up and down completely randomly.
Pair Corralation between Costco Wholesale and IShares Physical
Assuming the 90 days trading horizon Costco Wholesale Corp is expected to under-perform the IShares Physical. But the stock apears to be less risky and, when comparing its historical volatility, Costco Wholesale Corp is 1.75 times less risky than IShares Physical. The stock trades about -0.36 of its potential returns per unit of risk. The iShares Physical Silver is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 3,043 in iShares Physical Silver on October 11, 2024 and sell it today you would lose (159.00) from holding iShares Physical Silver or give up 5.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Costco Wholesale Corp vs. iShares Physical Silver
Performance |
| Timeline |
| Costco Wholesale Corp |
| iShares Physical Silver |
Costco Wholesale and IShares Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Costco Wholesale and IShares Physical
The main advantage of trading using opposite Costco Wholesale and IShares Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Costco Wholesale position performs unexpectedly, IShares Physical 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 IShares Physical will offset losses from the drop in IShares Physical's long position.| Costco Wholesale vs. PPHE Hotel Group | Costco Wholesale vs. Wyndham Hotels Resorts | Costco Wholesale vs. Gamma Communications PLC | Costco Wholesale vs. Infrastrutture Wireless Italiane |
| IShares Physical vs. Symphony Environmental Technologies | IShares Physical vs. SMA Solar Technology | IShares Physical vs. Costco Wholesale Corp | IShares Physical vs. Sartorius Stedim Biotech |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |