Correlation Between IShares Core and Elkhorn
Can any of the company-specific risk be diversified away by investing in both IShares Core and Elkhorn 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 Elkhorn 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 Elkhorn, you can compare the effects of market volatilities on IShares Core and Elkhorn 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 Elkhorn. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Elkhorn.
Diversification Opportunities for IShares Core and Elkhorn
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and Elkhorn is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and Elkhorn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elkhorn 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 Elkhorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elkhorn has no effect on the direction of IShares Core i.e., IShares Core and Elkhorn go up and down completely randomly.
Pair Corralation between IShares Core and Elkhorn
Considering the 90-day investment horizon iShares Core SP is expected to generate 4.8 times more return on investment than Elkhorn. However, IShares Core is 4.8 times more volatile than Elkhorn. It trades about 0.13 of its potential returns per unit of risk. Elkhorn is currently generating about 0.18 per unit of risk. If you would invest 42,174 in iShares Core SP on August 31, 2024 and sell it today you would earn a total of 18,333 from holding iShares Core SP or generate 43.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 3.74% |
| Values | Daily Returns |
iShares Core SP vs. Elkhorn
Performance |
| Timeline |
| iShares Core SP |
| Elkhorn |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IShares Core and Elkhorn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and Elkhorn
The main advantage of trading using opposite IShares Core and Elkhorn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Elkhorn 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 Elkhorn will offset losses from the drop in Elkhorn'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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Stocks Directory Find actively traded stocks across global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |