Correlation Between IShares Technology and XWEB
Can any of the company-specific risk be diversified away by investing in both IShares Technology and XWEB 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 Technology and XWEB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Technology ETF and XWEB, you can compare the effects of market volatilities on IShares Technology and XWEB 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 Technology with a short position of XWEB. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Technology and XWEB.
Diversification Opportunities for IShares Technology and XWEB
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and XWEB is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding iShares Technology ETF and XWEB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XWEB and IShares Technology 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 Technology ETF are associated (or correlated) with XWEB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XWEB has no effect on the direction of IShares Technology i.e., IShares Technology and XWEB go up and down completely randomly.
Pair Corralation between IShares Technology and XWEB
If you would invest 15,162 in iShares Technology ETF on August 30, 2024 and sell it today you would earn a total of 632.00 from holding iShares Technology ETF or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 2.27% |
| Values | Daily Returns |
iShares Technology ETF vs. XWEB
Performance |
| Timeline |
| iShares Technology ETF |
| XWEB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IShares Technology and XWEB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Technology and XWEB
The main advantage of trading using opposite IShares Technology and XWEB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Technology position performs unexpectedly, XWEB 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 XWEB will offset losses from the drop in XWEB's long position.| IShares Technology vs. iShares Healthcare ETF | IShares Technology vs. iShares Financials ETF | IShares Technology vs. iShares Telecommunications ETF | IShares Technology vs. iShares Industrials ETF |
| XWEB vs. SPDR FactSet Innovative | XWEB vs. SPDR SP Software | XWEB vs. SPDR Morgan Stanley | XWEB vs. SPDR SP Health |
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.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |