Correlation Between IShares Core and Barclays ETN
Can any of the company-specific risk be diversified away by investing in both IShares Core and Barclays ETN 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 Barclays ETN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core Dividend and Barclays ETN Shiller, you can compare the effects of market volatilities on IShares Core and Barclays ETN 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 Barclays ETN. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Barclays ETN.
Diversification Opportunities for IShares Core and Barclays ETN
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and Barclays is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core Dividend and Barclays ETN Shiller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays ETN Shiller 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 Dividend are associated (or correlated) with Barclays ETN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays ETN Shiller has no effect on the direction of IShares Core i.e., IShares Core and Barclays ETN go up and down completely randomly.
Pair Corralation between IShares Core and Barclays ETN
Given the investment horizon of 90 days iShares Core Dividend is expected to generate 0.78 times more return on investment than Barclays ETN. However, iShares Core Dividend is 1.28 times less risky than Barclays ETN. It trades about 0.32 of its potential returns per unit of risk. Barclays ETN Shiller is currently generating about 0.23 per unit of risk. If you would invest 6,134 in iShares Core Dividend on November 5, 2024 and sell it today you would earn a total of 240.00 from holding iShares Core Dividend or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Core Dividend vs. Barclays ETN Shiller
Performance |
| Timeline |
| iShares Core Dividend |
| Barclays ETN Shiller |
IShares Core and Barclays ETN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and Barclays ETN
The main advantage of trading using opposite IShares Core and Barclays ETN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Barclays ETN 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 Barclays ETN will offset losses from the drop in Barclays ETN's long position.| IShares Core vs. iShares Core High | IShares Core vs. Schwab Dividend Equity | IShares Core vs. ProShares SP 500 | IShares Core vs. Invesco SP 500 |
| Barclays ETN vs. VanEck China Bond | Barclays ETN vs. Barclays ETN Select | Barclays ETN vs. SPDR SSGA Large | Barclays ETN vs. Freedom 100 Emerging |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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