Correlation Between Volatility Shares and IShares
Can any of the company-specific risk be diversified away by investing in both Volatility Shares and IShares 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 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, you can compare the effects of market volatilities on Volatility Shares and IShares 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. Check out your portfolio center. Please also check ongoing floating volatility patterns of Volatility Shares and IShares.
Diversification Opportunities for Volatility Shares and IShares
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Volatility and IShares is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Volatility Shares Trust and IShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IShares 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. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IShares has no effect on the direction of Volatility Shares i.e., Volatility Shares and IShares go up and down completely randomly.
Pair Corralation between Volatility Shares and IShares
If you would invest 4,264 in Volatility Shares Trust on September 3, 2024 and sell it today you would earn a total of 1,550 from holding Volatility Shares Trust or generate 36.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 0.8% |
| Values | Daily Returns |
Volatility Shares Trust vs. IShares
Performance |
| Timeline |
| Volatility Shares Trust |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Volatility Shares and IShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Volatility Shares and IShares
The main advantage of trading using opposite Volatility Shares and IShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Volatility Shares position performs unexpectedly, IShares 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 will offset losses from the drop in IShares' long position.| Volatility Shares vs. Grayscale Bitcoin Trust | Volatility Shares vs. ProShares Bitcoin Strategy | Volatility Shares vs. Amplify Transformational Data | Volatility Shares vs. First Trust Indxx |
| IShares vs. Vanguard Mid Cap Value | IShares vs. SPDR SP Dividend | IShares vs. SCOR PK | IShares vs. HUMANA INC |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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