Correlation Between IShares Core and 21Shares Polygon
Can any of the company-specific risk be diversified away by investing in both IShares Core and 21Shares Polygon 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 Core and 21Shares Polygon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core SP and 21Shares Polygon ETP, you can compare the effects of market volatilities on IShares Core and 21Shares Polygon 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 Core with a short position of 21Shares Polygon. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and 21Shares Polygon.
Diversification Opportunities for IShares Core and 21Shares Polygon
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between IShares and 21Shares is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and 21Shares Polygon ETP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Polygon ETP and IShares Core 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 Core SP are associated (or correlated) with 21Shares Polygon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Polygon ETP has no effect on the direction of IShares Core i.e., IShares Core and 21Shares Polygon go up and down completely randomly.
Pair Corralation between IShares Core and 21Shares Polygon
Assuming the 90 days trading horizon IShares Core is expected to generate 12.02 times less return on investment than 21Shares Polygon. But when comparing it to its historical volatility, iShares Core SP is 11.29 times less risky than 21Shares Polygon. It trades about 0.33 of its potential returns per unit of risk. 21Shares Polygon ETP is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 368.00 in 21Shares Polygon ETP on September 1, 2024 and sell it today you would earn a total of 285.00 from holding 21Shares Polygon ETP or generate 77.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Core SP vs. 21Shares Polygon ETP
Performance |
| Timeline |
| iShares Core SP |
| 21Shares Polygon ETP |
IShares Core and 21Shares Polygon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and 21Shares Polygon
The main advantage of trading using opposite IShares Core and 21Shares Polygon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, 21Shares Polygon 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 21Shares Polygon will offset losses from the drop in 21Shares Polygon's long position.| IShares Core vs. iShares Corp Bond | IShares Core vs. iShares Emerging Asia | IShares Core vs. iShares MSCI Global | IShares Core vs. iShares VII PLC |
| 21Shares Polygon vs. UBSFund Solutions MSCI | 21Shares Polygon vs. Vanguard SP 500 | 21Shares Polygon vs. iShares VII PLC | 21Shares Polygon vs. iShares Core SP |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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