Correlation Between Simplify Asset and IndexIQ Active
Can any of the company-specific risk be diversified away by investing in both Simplify Asset and IndexIQ Active 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 Simplify Asset and IndexIQ Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simplify Asset Management and IndexIQ Active ETF, you can compare the effects of market volatilities on Simplify Asset and IndexIQ Active 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 Simplify Asset with a short position of IndexIQ Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simplify Asset and IndexIQ Active.
Diversification Opportunities for Simplify Asset and IndexIQ Active
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Simplify and IndexIQ is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Simplify Asset Management and IndexIQ Active ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IndexIQ Active ETF and Simplify Asset 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 Simplify Asset Management are associated (or correlated) with IndexIQ Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IndexIQ Active ETF has no effect on the direction of Simplify Asset i.e., Simplify Asset and IndexIQ Active go up and down completely randomly.
Pair Corralation between Simplify Asset and IndexIQ Active
If you would invest 2,109 in IndexIQ Active ETF on August 29, 2024 and sell it today you would earn a total of 8.00 from holding IndexIQ Active ETF or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Simplify Asset Management vs. IndexIQ Active ETF
Performance |
| Timeline |
| Simplify Asset Management |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| IndexIQ Active ETF |
Simplify Asset and IndexIQ Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simplify Asset and IndexIQ Active
The main advantage of trading using opposite Simplify Asset and IndexIQ Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simplify Asset position performs unexpectedly, IndexIQ Active 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 IndexIQ Active will offset losses from the drop in IndexIQ Active's long position.| Simplify Asset vs. Simplify Exchange Traded | Simplify Asset vs. Simplify Interest Rate | Simplify Asset vs. Simplify Exchange Traded | Simplify Asset vs. Simplify Equity PLUS |
| IndexIQ Active vs. SPDR Bloomberg Barclays | IndexIQ Active vs. FlexShares STOXX Global | IndexIQ Active vs. BNY Mellon ETF | IndexIQ Active vs. American Century Sustainable |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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