Correlation Between Pacer Funds and IShares Dividend
Can any of the company-specific risk be diversified away by investing in both Pacer Funds and IShares Dividend 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 Pacer Funds and IShares Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacer Funds Trust and iShares Dividend and, you can compare the effects of market volatilities on Pacer Funds and IShares Dividend 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 Pacer Funds with a short position of IShares Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacer Funds and IShares Dividend.
Diversification Opportunities for Pacer Funds and IShares Dividend
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pacer and IShares is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Pacer Funds Trust and iShares Dividend and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Dividend and Pacer Funds 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 Pacer Funds Trust are associated (or correlated) with IShares Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Dividend has no effect on the direction of Pacer Funds i.e., Pacer Funds and IShares Dividend go up and down completely randomly.
Pair Corralation between Pacer Funds and IShares Dividend
Given the investment horizon of 90 days Pacer Funds is expected to generate 2.96 times less return on investment than IShares Dividend. But when comparing it to its historical volatility, Pacer Funds Trust is 1.11 times less risky than IShares Dividend. It trades about 0.12 of its potential returns per unit of risk. iShares Dividend and is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 4,819 in iShares Dividend and on September 1, 2024 and sell it today you would earn a total of 276.00 from holding iShares Dividend and or generate 5.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Pacer Funds Trust vs. iShares Dividend and
Performance |
| Timeline |
| Pacer Funds Trust |
| iShares Dividend |
Pacer Funds and IShares Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pacer Funds and IShares Dividend
The main advantage of trading using opposite Pacer Funds and IShares Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacer Funds position performs unexpectedly, IShares Dividend 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 Dividend will offset losses from the drop in IShares Dividend's long position.| Pacer Funds vs. Invesco SP International | Pacer Funds vs. Invesco SP International | Pacer Funds vs. Invesco FTSE RAFI | Pacer Funds vs. Invesco SP Emerging |
| IShares Dividend vs. iShares ESG Aware | IShares Dividend vs. Pacer Cash Cows | IShares Dividend vs. iShares MSCI USA | IShares Dividend vs. Invesco KBW Premium |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |