Correlation Between IShares Intl and IQ MacKay
Can any of the company-specific risk be diversified away by investing in both IShares Intl and IQ MacKay 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 Intl and IQ MacKay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Intl High and IQ MacKay ESG, you can compare the effects of market volatilities on IShares Intl and IQ MacKay 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 Intl with a short position of IQ MacKay. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Intl and IQ MacKay.
Diversification Opportunities for IShares Intl and IQ MacKay
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and IQHI is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding iShares Intl High and IQ MacKay ESG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQ MacKay ESG and IShares Intl 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 Intl High are associated (or correlated) with IQ MacKay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQ MacKay ESG has no effect on the direction of IShares Intl i.e., IShares Intl and IQ MacKay go up and down completely randomly.
Pair Corralation between IShares Intl and IQ MacKay
Given the investment horizon of 90 days IShares Intl is expected to generate 2.02 times less return on investment than IQ MacKay. In addition to that, IShares Intl is 1.24 times more volatile than IQ MacKay ESG. It trades about 0.11 of its total potential returns per unit of risk. IQ MacKay ESG is currently generating about 0.28 per unit of volatility. If you would invest 2,657 in IQ MacKay ESG on September 1, 2024 and sell it today you would earn a total of 34.00 from holding IQ MacKay ESG or generate 1.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Intl High vs. IQ MacKay ESG
Performance |
| Timeline |
| iShares Intl High |
| IQ MacKay ESG |
IShares Intl and IQ MacKay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Intl and IQ MacKay
The main advantage of trading using opposite IShares Intl and IQ MacKay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Intl position performs unexpectedly, IQ MacKay 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 IQ MacKay will offset losses from the drop in IQ MacKay's long position.| IShares Intl vs. iShares International High | IShares Intl vs. iShares JP Morgan | IShares Intl vs. iShares JP Morgan | IShares Intl vs. VanEck International High |
| IQ MacKay vs. IndexIQ Active ETF | IQ MacKay vs. IndexIQ Active ETF | IQ MacKay vs. SSGA Active Trust | IQ MacKay vs. BlackRock Intermediate Muni |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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