Correlation Between IShares ESG and Cambria Micro
Can any of the company-specific risk be diversified away by investing in both IShares ESG and Cambria Micro 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 Cambria Micro 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 Cambria Micro And, you can compare the effects of market volatilities on IShares ESG and Cambria Micro 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 Cambria Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares ESG and Cambria Micro.
Diversification Opportunities for IShares ESG and Cambria Micro
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and Cambria is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding iShares ESG Aware and Cambria Micro And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Micro And 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 Cambria Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Micro And has no effect on the direction of IShares ESG i.e., IShares ESG and Cambria Micro go up and down completely randomly.
Pair Corralation between IShares ESG and Cambria Micro
Given the investment horizon of 90 days IShares ESG is expected to generate 1.32 times less return on investment than Cambria Micro. But when comparing it to its historical volatility, iShares ESG Aware is 1.6 times less risky than Cambria Micro. It trades about 0.08 of its potential returns per unit of risk. Cambria Micro And is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,429 in Cambria Micro And on August 29, 2024 and sell it today you would earn a total of 387.00 from holding Cambria Micro And or generate 15.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 49.67% |
| Values | Daily Returns |
iShares ESG Aware vs. Cambria Micro And
Performance |
| Timeline |
| iShares ESG Aware |
| Cambria Micro And |
IShares ESG and Cambria Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares ESG and Cambria Micro
The main advantage of trading using opposite IShares ESG and Cambria Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares ESG position performs unexpectedly, Cambria Micro 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 Cambria Micro will offset losses from the drop in Cambria Micro's long position.| IShares ESG vs. iShares MSCI USA | IShares ESG vs. ABIVAX Socit Anonyme | IShares ESG vs. HUMANA INC | IShares ESG vs. SCOR PK |
| Cambria Micro vs. FT Vest Equity | Cambria Micro vs. Northern Lights | Cambria Micro vs. Dimensional International High | Cambria Micro vs. First Trust Exchange Traded |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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