Correlation Between IShares Inflation and Janus Henderson
Can any of the company-specific risk be diversified away by investing in both IShares Inflation and Janus Henderson 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 Inflation and Janus Henderson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Inflation Hedged and Janus Henderson Short, you can compare the effects of market volatilities on IShares Inflation and Janus Henderson 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 Inflation with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Inflation and Janus Henderson.
Diversification Opportunities for IShares Inflation and Janus Henderson
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Janus is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding iShares Inflation Hedged and Janus Henderson Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson Short and IShares Inflation 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 Inflation Hedged are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson Short has no effect on the direction of IShares Inflation i.e., IShares Inflation and Janus Henderson go up and down completely randomly.
Pair Corralation between IShares Inflation and Janus Henderson
Given the investment horizon of 90 days iShares Inflation Hedged is expected to generate 6.7 times more return on investment than Janus Henderson. However, IShares Inflation is 6.7 times more volatile than Janus Henderson Short. It trades about 0.08 of its potential returns per unit of risk. Janus Henderson Short is currently generating about 0.5 per unit of risk. If you would invest 2,518 in iShares Inflation Hedged on September 3, 2024 and sell it today you would earn a total of 116.00 from holding iShares Inflation Hedged or generate 4.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Inflation Hedged vs. Janus Henderson Short
Performance |
| Timeline |
| iShares Inflation Hedged |
| Janus Henderson Short |
IShares Inflation and Janus Henderson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Inflation and Janus Henderson
The main advantage of trading using opposite IShares Inflation and Janus Henderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Inflation position performs unexpectedly, Janus Henderson 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 Janus Henderson will offset losses from the drop in Janus Henderson's long position.| IShares Inflation vs. iShares Interest Rate | IShares Inflation vs. iShares Interest Rate | IShares Inflation vs. iShares Edge Investment | IShares Inflation vs. iShares Interest Rate |
| Janus Henderson vs. Invesco Variable Rate | Janus Henderson vs. Invesco Ultra Short | Janus Henderson vs. SPDR Bloomberg Investment | Janus Henderson vs. First Trust Low |
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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