Correlation Between IShares ESG and Thrivent High
Can any of the company-specific risk be diversified away by investing in both IShares ESG and Thrivent High 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 ESG and Thrivent High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares ESG Aware and Thrivent High Yield, you can compare the effects of market volatilities on IShares ESG and Thrivent High 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 ESG with a short position of Thrivent High. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares ESG and Thrivent High.
Diversification Opportunities for IShares ESG and Thrivent High
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and Thrivent is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding iShares ESG Aware and Thrivent High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent High Yield and IShares ESG 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 ESG Aware are associated (or correlated) with Thrivent High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent High Yield has no effect on the direction of IShares ESG i.e., IShares ESG and Thrivent High go up and down completely randomly.
Pair Corralation between IShares ESG and Thrivent High
Given the investment horizon of 90 days iShares ESG Aware is expected to generate 4.1 times more return on investment than Thrivent High. However, IShares ESG is 4.1 times more volatile than Thrivent High Yield. It trades about 0.05 of its potential returns per unit of risk. Thrivent High Yield is currently generating about 0.18 per unit of risk. If you would invest 3,090 in iShares ESG Aware on August 24, 2024 and sell it today you would earn a total of 363.00 from holding iShares ESG Aware or generate 11.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares ESG Aware vs. Thrivent High Yield
Performance |
| Timeline |
| iShares ESG Aware |
| Thrivent High Yield |
IShares ESG and Thrivent High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares ESG and Thrivent High
The main advantage of trading using opposite IShares ESG and Thrivent High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares ESG position performs unexpectedly, Thrivent High 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 Thrivent High will offset losses from the drop in Thrivent High's long position.| IShares ESG vs. iShares ESG Aware | IShares ESG vs. iShares ESG Aware | IShares ESG vs. iShares ESG Aware | IShares ESG vs. iShares ESG USD |
| Thrivent High vs. Thrivent Large Cap | Thrivent High vs. HUMANA INC | Thrivent High vs. Aquagold International | Thrivent High vs. Barloworld Ltd ADR |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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