Correlation Between IShares Preferred and Global X
Can any of the company-specific risk be diversified away by investing in both IShares Preferred and Global X 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 Preferred and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Preferred and and Global X SuperIncome, you can compare the effects of market volatilities on IShares Preferred and Global X 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 Preferred with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Preferred and Global X.
Diversification Opportunities for IShares Preferred and Global X
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and Global is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding iShares Preferred and and Global X SuperIncome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SuperIncome and IShares Preferred 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 Preferred and are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X SuperIncome has no effect on the direction of IShares Preferred i.e., IShares Preferred and Global X go up and down completely randomly.
Pair Corralation between IShares Preferred and Global X
Considering the 90-day investment horizon IShares Preferred is expected to generate 31.46 times less return on investment than Global X. But when comparing it to its historical volatility, iShares Preferred and is 1.16 times less risky than Global X. It trades about 0.0 of its potential returns per unit of risk. Global X SuperIncome is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 938.00 in Global X SuperIncome on November 3, 2024 and sell it today you would earn a total of 7.00 from holding Global X SuperIncome or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
iShares Preferred and vs. Global X SuperIncome
Performance |
| Timeline |
| iShares Preferred |
| Global X SuperIncome |
IShares Preferred and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Preferred and Global X
The main advantage of trading using opposite IShares Preferred and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Preferred position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| IShares Preferred vs. Invesco Preferred ETF | IShares Preferred vs. iShares iBoxx High | IShares Preferred vs. Invesco Financial Preferred | IShares Preferred vs. SPDR Bloomberg High |
| Global X vs. Freedom Day Dividend | Global X vs. iShares MSCI China | Global X vs. SmartETFs Dividend Builder | Global X vs. Listed Funds Trust |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |