Correlation Between IShares IBoxx and Invesco Global
Can any of the company-specific risk be diversified away by investing in both IShares IBoxx and Invesco Global 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 IBoxx and Invesco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares iBoxx High and Invesco Global Short, you can compare the effects of market volatilities on IShares IBoxx and Invesco Global 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 IBoxx with a short position of Invesco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares IBoxx and Invesco Global.
Diversification Opportunities for IShares IBoxx and Invesco Global
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and Invesco is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding iShares iBoxx High and Invesco Global Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Global Short and IShares IBoxx 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 iBoxx High are associated (or correlated) with Invesco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Global Short has no effect on the direction of IShares IBoxx i.e., IShares IBoxx and Invesco Global go up and down completely randomly.
Pair Corralation between IShares IBoxx and Invesco Global
Considering the 90-day investment horizon iShares iBoxx High is expected to generate 0.68 times more return on investment than Invesco Global. However, iShares iBoxx High is 1.48 times less risky than Invesco Global. It trades about 0.15 of its potential returns per unit of risk. Invesco Global Short is currently generating about 0.03 per unit of risk. If you would invest 7,908 in iShares iBoxx High on August 29, 2024 and sell it today you would earn a total of 56.00 from holding iShares iBoxx High or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares iBoxx High vs. Invesco Global Short
Performance |
| Timeline |
| iShares iBoxx High |
| Invesco Global Short |
IShares IBoxx and Invesco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares IBoxx and Invesco Global
The main advantage of trading using opposite IShares IBoxx and Invesco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares IBoxx position performs unexpectedly, Invesco Global 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 Invesco Global will offset losses from the drop in Invesco Global's long position.| IShares IBoxx vs. iShares iBoxx Investment | IShares IBoxx vs. SPDR Bloomberg High | IShares IBoxx vs. iShares TIPS Bond | IShares IBoxx vs. iShares 20 Year |
| Invesco Global vs. VanEck Emerging Markets | Invesco Global vs. iShares Intl High | Invesco Global vs. VanEck International High | Invesco Global vs. Invesco Fundamental Investment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |