Correlation Between Simplify Macro and IShares
Can any of the company-specific risk be diversified away by investing in both Simplify Macro and IShares 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 Simplify Macro and IShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simplify Macro Strategy and IShares, you can compare the effects of market volatilities on Simplify Macro and IShares 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 Simplify Macro with a short position of IShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simplify Macro and IShares.
Diversification Opportunities for Simplify Macro and IShares
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Simplify and IShares is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Simplify Macro Strategy and IShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IShares and Simplify Macro 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 Simplify Macro Strategy are associated (or correlated) with IShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IShares has no effect on the direction of Simplify Macro i.e., Simplify Macro and IShares go up and down completely randomly.
Pair Corralation between Simplify Macro and IShares
Considering the 90-day investment horizon Simplify Macro Strategy is expected to generate 0.16 times more return on investment than IShares. However, Simplify Macro Strategy is 6.09 times less risky than IShares. It trades about 0.0 of its potential returns per unit of risk. IShares is currently generating about -0.04 per unit of risk. If you would invest 2,274 in Simplify Macro Strategy on September 3, 2024 and sell it today you would lose (15.00) from holding Simplify Macro Strategy or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 84.65% |
| Values | Daily Returns |
Simplify Macro Strategy vs. IShares
Performance |
| Timeline |
| Simplify Macro Strategy |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Simplify Macro and IShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simplify Macro and IShares
The main advantage of trading using opposite Simplify Macro and IShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simplify Macro position performs unexpectedly, IShares 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 will offset losses from the drop in IShares' long position.| Simplify Macro vs. MBIA Inc | Simplify Macro vs. Lazard | Simplify Macro vs. Blackstone Group | Simplify Macro vs. MGIC Investment Corp |
| IShares vs. BlackRock Future Health | IShares vs. Goldman Sachs Innovate | IShares vs. iShares Tech Breakthrough |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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