Correlation Between NEOS ETF and IShares Core
Can any of the company-specific risk be diversified away by investing in both NEOS ETF and IShares Core 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 NEOS ETF and IShares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NEOS ETF Trust and iShares Core Moderate, you can compare the effects of market volatilities on NEOS ETF and IShares Core 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 NEOS ETF with a short position of IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEOS ETF and IShares Core.
Diversification Opportunities for NEOS ETF and IShares Core
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NEOS and IShares is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding NEOS ETF Trust and iShares Core Moderate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Moderate and NEOS ETF 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 NEOS ETF Trust are associated (or correlated) with IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Moderate has no effect on the direction of NEOS ETF i.e., NEOS ETF and IShares Core go up and down completely randomly.
Pair Corralation between NEOS ETF and IShares Core
Given the investment horizon of 90 days NEOS ETF Trust is expected to generate 2.18 times more return on investment than IShares Core. However, NEOS ETF is 2.18 times more volatile than iShares Core Moderate. It trades about 0.11 of its potential returns per unit of risk. iShares Core Moderate is currently generating about 0.09 per unit of risk. If you would invest 2,536 in NEOS ETF Trust on August 29, 2024 and sell it today you would earn a total of 53.00 from holding NEOS ETF Trust or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NEOS ETF Trust vs. iShares Core Moderate
Performance |
| Timeline |
| NEOS ETF Trust |
| iShares Core Moderate |
NEOS ETF and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NEOS ETF and IShares Core
The main advantage of trading using opposite NEOS ETF and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NEOS ETF position performs unexpectedly, IShares Core 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 Core will offset losses from the drop in IShares Core's long position.| NEOS ETF vs. Global X Russell | NEOS ETF vs. Global X SP | NEOS ETF vs. Global X NASDAQ | NEOS ETF vs. Amplify CWP Enhanced |
| IShares Core vs. NEOS ETF Trust | IShares Core vs. First Trust Multi Asset | IShares Core vs. Amplify High Income | IShares Core vs. Global X Russell |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |