Correlation Between GraniteShares and IShares Corp
Can any of the company-specific risk be diversified away by investing in both GraniteShares and IShares Corp 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 GraniteShares and IShares Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 3x Short and iShares Corp Bond, you can compare the effects of market volatilities on GraniteShares and IShares Corp 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 GraniteShares with a short position of IShares Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and IShares Corp.
Diversification Opportunities for GraniteShares and IShares Corp
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GraniteShares and IShares is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 3x Short and iShares Corp Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Corp Bond and GraniteShares 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 GraniteShares 3x Short are associated (or correlated) with IShares Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Corp Bond has no effect on the direction of GraniteShares i.e., GraniteShares and IShares Corp go up and down completely randomly.
Pair Corralation between GraniteShares and IShares Corp
Assuming the 90 days trading horizon GraniteShares 3x Short is expected to under-perform the IShares Corp. In addition to that, GraniteShares is 21.5 times more volatile than iShares Corp Bond. It trades about -0.03 of its total potential returns per unit of risk. iShares Corp Bond is currently generating about 0.14 per unit of volatility. If you would invest 10,342 in iShares Corp Bond on September 2, 2024 and sell it today you would earn a total of 87.00 from holding iShares Corp Bond or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares 3x Short vs. iShares Corp Bond
Performance |
| Timeline |
| GraniteShares 3x Short |
| iShares Corp Bond |
GraniteShares and IShares Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares and IShares Corp
The main advantage of trading using opposite GraniteShares and IShares Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares position performs unexpectedly, IShares Corp 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 Corp will offset losses from the drop in IShares Corp's long position.| GraniteShares vs. GraniteShares 3x Short | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 1x Short |
| IShares Corp vs. iShares MSCI Japan | IShares Corp vs. iShares JP Morgan | IShares Corp vs. iShares MSCI Europe | IShares Corp vs. iShares Nasdaq Biotechnology |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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