Correlation Between IShares Biotechnology and Horizon Kinetics
Can any of the company-specific risk be diversified away by investing in both IShares Biotechnology and Horizon Kinetics 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 Biotechnology and Horizon Kinetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Biotechnology ETF and Horizon Kinetics SPAC, you can compare the effects of market volatilities on IShares Biotechnology and Horizon Kinetics 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 Biotechnology with a short position of Horizon Kinetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Biotechnology and Horizon Kinetics.
Diversification Opportunities for IShares Biotechnology and Horizon Kinetics
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Horizon is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding iShares Biotechnology ETF and Horizon Kinetics SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Kinetics SPAC and IShares Biotechnology 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 Biotechnology ETF are associated (or correlated) with Horizon Kinetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Kinetics SPAC has no effect on the direction of IShares Biotechnology i.e., IShares Biotechnology and Horizon Kinetics go up and down completely randomly.
Pair Corralation between IShares Biotechnology and Horizon Kinetics
Considering the 90-day investment horizon iShares Biotechnology ETF is expected to generate 3.95 times more return on investment than Horizon Kinetics. However, IShares Biotechnology is 3.95 times more volatile than Horizon Kinetics SPAC. It trades about 0.12 of its potential returns per unit of risk. Horizon Kinetics SPAC is currently generating about 0.13 per unit of risk. If you would invest 13,265 in iShares Biotechnology ETF on November 18, 2024 and sell it today you would earn a total of 390.00 from holding iShares Biotechnology ETF or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Biotechnology ETF vs. Horizon Kinetics SPAC
Performance |
| Timeline |
| iShares Biotechnology ETF |
| Horizon Kinetics SPAC |
IShares Biotechnology and Horizon Kinetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Biotechnology and Horizon Kinetics
The main advantage of trading using opposite IShares Biotechnology and Horizon Kinetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Biotechnology position performs unexpectedly, Horizon Kinetics 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 Horizon Kinetics will offset losses from the drop in Horizon Kinetics' long position.| IShares Biotechnology vs. First Trust Exchange Traded | IShares Biotechnology vs. Horizon Kinetics Medical | IShares Biotechnology vs. Harbor Health Care | IShares Biotechnology vs. Fidelity MSCI Health |
| Horizon Kinetics vs. iShares Dividend and | Horizon Kinetics vs. Martin Currie Sustainable | Horizon Kinetics vs. VictoryShares THB Mid | Horizon Kinetics vs. Mast Global Battery |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| 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 | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |