Correlation Between Volatility Shares and IShares Trust
Can any of the company-specific risk be diversified away by investing in both Volatility Shares 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 Volatility Shares and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Volatility Shares Trust and iShares Trust , you can compare the effects of market volatilities on Volatility Shares 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 Volatility Shares with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Volatility Shares and IShares Trust.
Diversification Opportunities for Volatility Shares and IShares Trust
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Volatility and IShares is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Volatility Shares Trust and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and Volatility Shares 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 Volatility Shares Trust 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 Volatility Shares i.e., Volatility Shares and IShares Trust go up and down completely randomly.
Pair Corralation between Volatility Shares and IShares Trust
Given the investment horizon of 90 days Volatility Shares Trust is expected to generate 20.6 times more return on investment than IShares Trust. However, Volatility Shares is 20.6 times more volatile than iShares Trust . It trades about 0.44 of its potential returns per unit of risk. iShares Trust is currently generating about -0.05 per unit of risk. If you would invest 3,293 in Volatility Shares Trust on August 27, 2024 and sell it today you would earn a total of 3,125 from holding Volatility Shares Trust or generate 94.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Volatility Shares Trust vs. iShares Trust
Performance |
| Timeline |
| Volatility Shares Trust |
| iShares Trust |
Volatility Shares and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Volatility Shares and IShares Trust
The main advantage of trading using opposite Volatility Shares and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Volatility Shares 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.| Volatility Shares vs. Grayscale Bitcoin Trust | Volatility Shares vs. Siren Nasdaq NexGen | Volatility Shares vs. Grayscale Bitcoin Mini | Volatility Shares vs. First Trust SkyBridge |
| IShares Trust vs. First Trust Low | IShares Trust vs. First Trust Enhanced | IShares Trust vs. First Trust Tactical | IShares Trust vs. First Trust Managed |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| CEOs Directory Screen CEOs from public companies around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |