Correlation Between IXSE and IShares India
Can any of the company-specific risk be diversified away by investing in both IXSE and IShares India 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 IXSE and IShares India into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IXSE and iShares India 50, you can compare the effects of market volatilities on IXSE and IShares India 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 IXSE with a short position of IShares India. Check out your portfolio center. Please also check ongoing floating volatility patterns of IXSE and IShares India.
Diversification Opportunities for IXSE and IShares India
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IXSE and IShares is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding IXSE and iShares India 50 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares India 50 and IXSE 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 IXSE are associated (or correlated) with IShares India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares India 50 has no effect on the direction of IXSE i.e., IXSE and IShares India go up and down completely randomly.
Pair Corralation between IXSE and IShares India
Given the investment horizon of 90 days IXSE is expected to generate 0.69 times more return on investment than IShares India. However, IXSE is 1.44 times less risky than IShares India. It trades about 0.31 of its potential returns per unit of risk. iShares India 50 is currently generating about 0.08 per unit of risk. If you would invest 3,114 in IXSE on September 2, 2024 and sell it today you would earn a total of 274.00 from holding IXSE or generate 8.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 12.98% |
| Values | Daily Returns |
IXSE vs. iShares India 50
Performance |
| Timeline |
| IXSE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| iShares India 50 |
IXSE and IShares India Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IXSE and IShares India
The main advantage of trading using opposite IXSE and IShares India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IXSE position performs unexpectedly, IShares India 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 India will offset losses from the drop in IShares India's long position.| IXSE vs. Franklin FTSE India | IXSE vs. VanEck India Growth | IXSE vs. First Trust India | IXSE vs. Columbia India Consumer |
| IShares India vs. iShares MSCI India | IShares India vs. Invesco India ETF | IShares India vs. iShares MSCI India | IShares India vs. WisdomTree India Earnings |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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