Correlation Between Columbia Multi and IShares National
Can any of the company-specific risk be diversified away by investing in both Columbia Multi and IShares National 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 Columbia Multi and IShares National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Multi Sector Municipal and iShares National Muni, you can compare the effects of market volatilities on Columbia Multi and IShares National 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 Columbia Multi with a short position of IShares National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Multi and IShares National.
Diversification Opportunities for Columbia Multi and IShares National
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Columbia and IShares is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Multi Sector Municipa and iShares National Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares National Muni and Columbia Multi 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 Columbia Multi Sector Municipal are associated (or correlated) with IShares National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares National Muni has no effect on the direction of Columbia Multi i.e., Columbia Multi and IShares National go up and down completely randomly.
Pair Corralation between Columbia Multi and IShares National
Given the investment horizon of 90 days Columbia Multi Sector Municipal is expected to generate 1.29 times more return on investment than IShares National. However, Columbia Multi is 1.29 times more volatile than iShares National Muni. It trades about 0.05 of its potential returns per unit of risk. iShares National Muni is currently generating about 0.06 per unit of risk. If you would invest 1,958 in Columbia Multi Sector Municipal on August 31, 2024 and sell it today you would earn a total of 129.00 from holding Columbia Multi Sector Municipal or generate 6.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Multi Sector Municipa vs. iShares National Muni
Performance |
| Timeline |
| Columbia Multi Sector |
| iShares National Muni |
Columbia Multi and IShares National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Multi and IShares National
The main advantage of trading using opposite Columbia Multi and IShares National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Multi position performs unexpectedly, IShares National 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 National will offset losses from the drop in IShares National's long position.| Columbia Multi vs. iShares JP Morgan | Columbia Multi vs. iShares iBoxx Investment | Columbia Multi vs. SPDR Nuveen Bloomberg | Columbia Multi vs. iShares MBS ETF |
| IShares National vs. iShares JP Morgan | IShares National vs. iShares iBoxx Investment | IShares National vs. SPDR Nuveen Bloomberg | IShares National vs. iShares MBS ETF |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |