Correlation Between IShares IBonds and Stone Ridge
Can any of the company-specific risk be diversified away by investing in both IShares IBonds and Stone Ridge 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 IBonds and Stone Ridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares iBonds Dec and Stone Ridge 2054, you can compare the effects of market volatilities on IShares IBonds and Stone Ridge 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 IBonds with a short position of Stone Ridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares IBonds and Stone Ridge.
Diversification Opportunities for IShares IBonds and Stone Ridge
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and Stone is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding iShares iBonds Dec and Stone Ridge 2054 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stone Ridge 2054 and IShares IBonds 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 iBonds Dec are associated (or correlated) with Stone Ridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stone Ridge 2054 has no effect on the direction of IShares IBonds i.e., IShares IBonds and Stone Ridge go up and down completely randomly.
Pair Corralation between IShares IBonds and Stone Ridge
Given the investment horizon of 90 days iShares iBonds Dec is expected to generate 0.37 times more return on investment than Stone Ridge. However, iShares iBonds Dec is 2.68 times less risky than Stone Ridge. It trades about 0.1 of its potential returns per unit of risk. Stone Ridge 2054 is currently generating about -0.15 per unit of risk. If you would invest 2,307 in iShares iBonds Dec on August 25, 2024 and sell it today you would earn a total of 92.00 from holding iShares iBonds Dec or generate 3.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 24.45% |
| Values | Daily Returns |
iShares iBonds Dec vs. Stone Ridge 2054
Performance |
| Timeline |
| iShares iBonds Dec |
| Stone Ridge 2054 |
IShares IBonds and Stone Ridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares IBonds and Stone Ridge
The main advantage of trading using opposite IShares IBonds and Stone Ridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares IBonds position performs unexpectedly, Stone Ridge 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 Stone Ridge will offset losses from the drop in Stone Ridge's long position.| IShares IBonds vs. iShares iBonds Dec | IShares IBonds vs. iShares iBonds Dec | IShares IBonds vs. iShares iBonds Dec | IShares IBonds vs. iShares iBonds Dec |
| Stone Ridge vs. Vanguard Short Term Inflation Protected | Stone Ridge vs. iShares TIPS Bond | Stone Ridge vs. Invesco PureBeta 0 5 | Stone Ridge vs. Goldman Sachs Access |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |