Correlation Between IShares and IShares Expanded
Can any of the company-specific risk be diversified away by investing in both IShares and IShares Expanded 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 and IShares Expanded into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IShares and iShares Expanded Tech Software, you can compare the effects of market volatilities on IShares and IShares Expanded 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 with a short position of IShares Expanded. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares and IShares Expanded.
Diversification Opportunities for IShares and IShares Expanded
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and IShares is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding IShares and iShares Expanded Tech Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Expanded Tech and IShares 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 are associated (or correlated) with IShares Expanded. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Expanded Tech has no effect on the direction of IShares i.e., IShares and IShares Expanded go up and down completely randomly.
Pair Corralation between IShares and IShares Expanded
If you would invest 7,654 in iShares Expanded Tech Software on August 24, 2024 and sell it today you would earn a total of 2,800 from holding iShares Expanded Tech Software or generate 36.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.4% |
| Values | Daily Returns |
IShares vs. iShares Expanded Tech Software
Performance |
| Timeline |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| iShares Expanded Tech |
IShares and IShares Expanded Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares and IShares Expanded
The main advantage of trading using opposite IShares and IShares Expanded positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares position performs unexpectedly, IShares Expanded 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 IShares Expanded will offset losses from the drop in IShares Expanded's long position.| IShares vs. iShares Expanded Tech | IShares vs. iShares Consumer Discretionary | IShares vs. iShares Telecommunications ETF | IShares vs. iShares Industrials ETF |
| IShares Expanded vs. First Trust Technology | IShares Expanded vs. Fidelity MSCI Information | IShares Expanded vs. First Trust Nasdaq | IShares Expanded vs. iShares Global Tech |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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