Correlation Between IShares Core and IndexIQ
Can any of the company-specific risk be diversified away by investing in both IShares Core and IndexIQ 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 Core and IndexIQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core SP and IndexIQ, you can compare the effects of market volatilities on IShares Core and IndexIQ 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 Core with a short position of IndexIQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and IndexIQ.
Diversification Opportunities for IShares Core and IndexIQ
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and IndexIQ is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and IndexIQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IndexIQ and IShares Core 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 Core SP are associated (or correlated) with IndexIQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IndexIQ has no effect on the direction of IShares Core i.e., IShares Core and IndexIQ go up and down completely randomly.
Pair Corralation between IShares Core and IndexIQ
If you would invest 58,267 in iShares Core SP on August 31, 2024 and sell it today you would earn a total of 1,915 from holding iShares Core SP or generate 3.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
iShares Core SP vs. IndexIQ
Performance |
| Timeline |
| iShares Core SP |
| IndexIQ |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IShares Core and IndexIQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and IndexIQ
The main advantage of trading using opposite IShares Core and IndexIQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, IndexIQ 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 IndexIQ will offset losses from the drop in IndexIQ's long position.| IShares Core vs. iShares Core SP | IShares Core vs. iShares Core SP | IShares Core vs. iShares SP 500 | IShares Core vs. iShares Russell 2000 |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |