Correlation Between IShares Global and IShares FTSE
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By analyzing existing cross correlation between iShares Global AAA AA and iShares FTSE MIB, you can compare the effects of market volatilities on IShares Global and IShares FTSE 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 Global with a short position of IShares FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Global and IShares FTSE.
Diversification Opportunities for IShares Global and IShares FTSE
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and IShares is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding iShares Global AAA AA and iShares FTSE MIB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares FTSE MIB and IShares Global 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 Global AAA AA are associated (or correlated) with IShares FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares FTSE MIB has no effect on the direction of IShares Global i.e., IShares Global and IShares FTSE go up and down completely randomly.
Pair Corralation between IShares Global and IShares FTSE
Assuming the 90 days trading horizon IShares Global is expected to generate 2.59 times less return on investment than IShares FTSE. But when comparing it to its historical volatility, iShares Global AAA AA is 2.9 times less risky than IShares FTSE. It trades about 0.05 of its potential returns per unit of risk. iShares FTSE MIB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 14,428 in iShares FTSE MIB on August 27, 2024 and sell it today you would earn a total of 940.00 from holding iShares FTSE MIB or generate 6.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
iShares Global AAA AA vs. iShares FTSE MIB
Performance |
| Timeline |
| iShares Global AAA |
| iShares FTSE MIB |
IShares Global and IShares FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Global and IShares FTSE
The main advantage of trading using opposite IShares Global and IShares FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Global position performs unexpectedly, IShares FTSE 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 FTSE will offset losses from the drop in IShares FTSE's long position.| IShares Global vs. UBS Fund Solutions | IShares Global vs. Xtrackers II | IShares Global vs. Xtrackers Nikkei 225 | IShares Global vs. iShares VII PLC |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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