Correlation Between Barclays ETN and IShares Trust
Can any of the company-specific risk be diversified away by investing in both Barclays ETN and IShares Trust 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 Barclays ETN and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays ETN Select and iShares Trust, you can compare the effects of market volatilities on Barclays ETN and IShares Trust 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 Barclays ETN with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays ETN and IShares Trust.
Diversification Opportunities for Barclays ETN and IShares Trust
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Barclays and IShares is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Barclays ETN Select and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and Barclays ETN 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 Barclays ETN Select are associated (or correlated) with IShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Trust has no effect on the direction of Barclays ETN i.e., Barclays ETN and IShares Trust go up and down completely randomly.
Pair Corralation between Barclays ETN and IShares Trust
Given the investment horizon of 90 days Barclays ETN Select is expected to generate 2.25 times more return on investment than IShares Trust. However, Barclays ETN is 2.25 times more volatile than iShares Trust. It trades about 0.61 of its potential returns per unit of risk. iShares Trust is currently generating about 0.15 per unit of risk. If you would invest 2,658 in Barclays ETN Select on September 1, 2024 and sell it today you would earn a total of 370.00 from holding Barclays ETN Select or generate 13.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Barclays ETN Select vs. iShares Trust
Performance |
| Timeline |
| Barclays ETN Select |
| iShares Trust |
Barclays ETN and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barclays ETN and IShares Trust
The main advantage of trading using opposite Barclays ETN and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays ETN position performs unexpectedly, IShares Trust 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 Trust will offset losses from the drop in IShares Trust's long position.| Barclays ETN vs. First Trust North | Barclays ETN vs. Global X MLP | Barclays ETN vs. Tortoise North American | Barclays ETN vs. UBS AG London |
| IShares Trust vs. VanEck Vectors Moodys | IShares Trust vs. BondBloxx ETF Trust | IShares Trust vs. Vanguard ESG Corporate | IShares Trust vs. Vanguard Intermediate Term Corporate |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |