Correlation Between IShares Fundamental and CNJ Capital
Can any of the company-specific risk be diversified away by investing in both IShares Fundamental and CNJ Capital 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 IShares Fundamental and CNJ Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Fundamental Hedged and CNJ Capital Investments, you can compare the effects of market volatilities on IShares Fundamental and CNJ Capital 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 IShares Fundamental with a short position of CNJ Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Fundamental and CNJ Capital.
Diversification Opportunities for IShares Fundamental and CNJ Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IShares and CNJ is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares Fundamental Hedged and CNJ Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNJ Capital Investments and IShares Fundamental 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 iShares Fundamental Hedged are associated (or correlated) with CNJ Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNJ Capital Investments has no effect on the direction of IShares Fundamental i.e., IShares Fundamental and CNJ Capital go up and down completely randomly.
Pair Corralation between IShares Fundamental and CNJ Capital
Assuming the 90 days trading horizon IShares Fundamental is expected to generate 1.04 times less return on investment than CNJ Capital. But when comparing it to its historical volatility, iShares Fundamental Hedged is 7.87 times less risky than CNJ Capital. It trades about 0.14 of its potential returns per unit of risk. CNJ Capital Investments is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 48.00 in CNJ Capital Investments on September 4, 2024 and sell it today you would lose (2.00) from holding CNJ Capital Investments or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Fundamental Hedged vs. CNJ Capital Investments
Performance |
| Timeline |
| iShares Fundamental |
| CNJ Capital Investments |
IShares Fundamental and CNJ Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Fundamental and CNJ Capital
The main advantage of trading using opposite IShares Fundamental and CNJ Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Fundamental position performs unexpectedly, CNJ Capital 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 CNJ Capital will offset losses from the drop in CNJ Capital's long position.| IShares Fundamental vs. iShares Convertible Bond | IShares Fundamental vs. iShares SP Mid Cap | IShares Fundamental vs. iShares Edge MSCI | IShares Fundamental vs. iShares Flexible Monthly |
| CNJ Capital vs. iShares Canadian HYBrid | CNJ Capital vs. Altagas Cum Red | CNJ Capital vs. European Residential Real | CNJ Capital vs. iShares Fundamental Hedged |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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