Correlation Between Aptus Defined and IShares Trust
Can any of the company-specific risk be diversified away by investing in both Aptus Defined and IShares Trust 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 Aptus Defined and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aptus Defined Risk and iShares Trust, you can compare the effects of market volatilities on Aptus Defined and IShares Trust 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 Aptus Defined with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptus Defined and IShares Trust.
Diversification Opportunities for Aptus Defined and IShares Trust
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aptus and IShares is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Aptus Defined Risk and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and Aptus Defined 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 Aptus Defined Risk are associated (or correlated) with IShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Trust has no effect on the direction of Aptus Defined i.e., Aptus Defined and IShares Trust go up and down completely randomly.
Pair Corralation between Aptus Defined and IShares Trust
Given the investment horizon of 90 days Aptus Defined is expected to generate 77.51 times less return on investment than IShares Trust. But when comparing it to its historical volatility, Aptus Defined Risk is 117.96 times less risky than IShares Trust. It trades about 0.09 of its potential returns per unit of risk. iShares Trust is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 0.00 in iShares Trust on September 14, 2024 and sell it today you would earn a total of 3,061 from holding iShares Trust or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 74.3% |
| Values | Daily Returns |
Aptus Defined Risk vs. iShares Trust
Performance |
| Timeline |
| Aptus Defined Risk |
| iShares Trust |
Aptus Defined and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aptus Defined and IShares Trust
The main advantage of trading using opposite Aptus Defined and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aptus Defined position performs unexpectedly, IShares Trust 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 Trust will offset losses from the drop in IShares Trust's long position.| Aptus Defined vs. Amplify BlackSwan Growth | Aptus Defined vs. Aptus Collared Income | Aptus Defined vs. Aptus Drawdown Managed | Aptus Defined vs. Cambria Tail Risk |
| IShares Trust vs. First Trust Multi Asset | IShares Trust vs. Collaborative Investment Series | IShares Trust vs. EA Series Trust | IShares Trust vs. Aptus Defined Risk |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |