Correlation Between Amundi EUR and IShares SP
Can any of the company-specific risk be diversified away by investing in both Amundi EUR and IShares SP 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 Amundi EUR and IShares SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi EUR High and iShares SP 500, you can compare the effects of market volatilities on Amundi EUR and IShares SP 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 Amundi EUR with a short position of IShares SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi EUR and IShares SP.
Diversification Opportunities for Amundi EUR and IShares SP
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amundi and IShares is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Amundi EUR High and iShares SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares SP 500 and Amundi EUR 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 Amundi EUR High are associated (or correlated) with IShares SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares SP 500 has no effect on the direction of Amundi EUR i.e., Amundi EUR and IShares SP go up and down completely randomly.
Pair Corralation between Amundi EUR and IShares SP
Assuming the 90 days trading horizon Amundi EUR High is expected to under-perform the IShares SP. But the etf apears to be less risky and, when comparing its historical volatility, Amundi EUR High is 3.27 times less risky than IShares SP. The etf trades about -0.06 of its potential returns per unit of risk. The iShares SP 500 is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 5,938 in iShares SP 500 on October 28, 2024 and sell it today you would earn a total of 154.00 from holding iShares SP 500 or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 47.37% |
| Values | Daily Returns |
Amundi EUR High vs. iShares SP 500
Performance |
| Timeline |
| Amundi EUR High |
| iShares SP 500 |
Amundi EUR and IShares SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi EUR and IShares SP
The main advantage of trading using opposite Amundi EUR and IShares SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi EUR position performs unexpectedly, IShares SP 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 SP will offset losses from the drop in IShares SP's long position.| Amundi EUR vs. Amundi Index Solutions | Amundi EUR vs. Amundi Index Solutions | Amundi EUR vs. Amundi Index Solutions | Amundi EUR vs. Amundi Index Solutions |
| IShares SP vs. iShares Corp Bond | IShares SP vs. iShares Emerging Asia | IShares SP vs. iShares MSCI Global | IShares SP vs. iShares VII PLC |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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