Correlation Between YieldMax MSTR and IShares Trust
Can any of the company-specific risk be diversified away by investing in both YieldMax MSTR and IShares Trust 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 YieldMax MSTR and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YieldMax MSTR Option and iShares Trust , you can compare the effects of market volatilities on YieldMax MSTR and IShares Trust 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 YieldMax MSTR with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of YieldMax MSTR and IShares Trust.
Diversification Opportunities for YieldMax MSTR and IShares Trust
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between YieldMax and IShares is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding YieldMax MSTR Option and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and YieldMax MSTR 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 YieldMax MSTR Option are associated (or correlated) with IShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Trust has no effect on the direction of YieldMax MSTR i.e., YieldMax MSTR and IShares Trust go up and down completely randomly.
Pair Corralation between YieldMax MSTR and IShares Trust
Given the investment horizon of 90 days YieldMax MSTR Option is expected to generate 27.58 times more return on investment than IShares Trust. However, YieldMax MSTR is 27.58 times more volatile than iShares Trust . It trades about 0.21 of its potential returns per unit of risk. iShares Trust is currently generating about 0.05 per unit of risk. If you would invest 2,011 in YieldMax MSTR Option on August 28, 2024 and sell it today you would earn a total of 1,137 from holding YieldMax MSTR Option or generate 56.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YieldMax MSTR Option vs. iShares Trust
Performance |
| Timeline |
| YieldMax MSTR Option |
| iShares Trust |
YieldMax MSTR and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YieldMax MSTR and IShares Trust
The main advantage of trading using opposite YieldMax MSTR and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YieldMax MSTR position performs unexpectedly, IShares Trust 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 Trust will offset losses from the drop in IShares Trust's long position.| YieldMax MSTR vs. Tidal Trust II | YieldMax MSTR vs. Tidal Trust II | YieldMax MSTR vs. First Trust Dorsey | YieldMax MSTR vs. Direxion Daily META |
| IShares Trust vs. iShares Trust | IShares Trust vs. iShares Trust | IShares Trust vs. Simplify Volatility Premium | IShares Trust vs. Tidal Trust II |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |