Correlation Between IShares International and Xtrackers High
Can any of the company-specific risk be diversified away by investing in both IShares International and Xtrackers 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 International and Xtrackers High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares International High and Xtrackers High Beta, you can compare the effects of market volatilities on IShares International and Xtrackers 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 International with a short position of Xtrackers High. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares International and Xtrackers High.
Diversification Opportunities for IShares International and Xtrackers High
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Xtrackers is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding iShares International High and Xtrackers High Beta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers High Beta and IShares International 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 International High are associated (or correlated) with Xtrackers High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers High Beta has no effect on the direction of IShares International i.e., IShares International and Xtrackers High go up and down completely randomly.
Pair Corralation between IShares International and Xtrackers High
Given the investment horizon of 90 days IShares International is expected to generate 1.3 times less return on investment than Xtrackers High. In addition to that, IShares International is 1.25 times more volatile than Xtrackers High Beta. It trades about 0.06 of its total potential returns per unit of risk. Xtrackers High Beta is currently generating about 0.1 per unit of volatility. If you would invest 3,410 in Xtrackers High Beta on September 2, 2024 and sell it today you would earn a total of 850.00 from holding Xtrackers High Beta or generate 24.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares International High vs. Xtrackers High Beta
Performance |
| Timeline |
| iShares International |
| Xtrackers High Beta |
IShares International and Xtrackers High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares International and Xtrackers High
The main advantage of trading using opposite IShares International and Xtrackers High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares International position performs unexpectedly, Xtrackers 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 Xtrackers High will offset losses from the drop in Xtrackers High's long position.| IShares International vs. iShares Intl High | IShares International vs. iShares JP Morgan | IShares International vs. VanEck International High | IShares International vs. iShares JP Morgan |
| Xtrackers High vs. Xtrackers Short Duration | Xtrackers High vs. FlexShares High Yield | Xtrackers High vs. Xtrackers Low Beta | Xtrackers High vs. iShares Edge High |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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