Correlation Between IShares Russell and IShares
Can any of the company-specific risk be diversified away by investing in both IShares Russell and IShares 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 Russell and IShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Russell Mid Cap and IShares, you can compare the effects of market volatilities on IShares Russell and IShares 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 Russell with a short position of IShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Russell and IShares.
Diversification Opportunities for IShares Russell and IShares
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and IShares is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding iShares Russell Mid Cap and IShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IShares and IShares Russell 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 Russell Mid Cap are associated (or correlated) with IShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IShares has no effect on the direction of IShares Russell i.e., IShares Russell and IShares go up and down completely randomly.
Pair Corralation between IShares Russell and IShares
If you would invest 11,729 in iShares Russell Mid Cap on August 29, 2024 and sell it today you would earn a total of 1,825 from holding iShares Russell Mid Cap or generate 15.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 2.33% |
| Values | Daily Returns |
iShares Russell Mid Cap vs. IShares
Performance |
| Timeline |
| iShares Russell Mid |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IShares Russell and IShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Russell and IShares
The main advantage of trading using opposite IShares Russell and IShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Russell position performs unexpectedly, IShares 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 will offset losses from the drop in IShares' long position.| IShares Russell vs. JPMorgan Fundamental Data | IShares Russell vs. Vanguard Mid Cap Index | IShares Russell vs. SPDR SP 400 | IShares Russell vs. SPDR SP 400 |
| IShares vs. BlackRock Future Health | IShares vs. Global X Thematic | IShares vs. Aquagold International | IShares vs. Morningstar Unconstrained Allocation |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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