Correlation Between ETFis Series and ETF Series
Can any of the company-specific risk be diversified away by investing in both ETFis Series and ETF Series 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 ETFis Series and ETF Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETFis Series Trust and ETF Series Solutions, you can compare the effects of market volatilities on ETFis Series and ETF Series 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 ETFis Series with a short position of ETF Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETFis Series and ETF Series.
Diversification Opportunities for ETFis Series and ETF Series
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ETFis and ETF is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding ETFis Series Trust and ETF Series Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETF Series Solutions and ETFis Series 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 ETFis Series Trust are associated (or correlated) with ETF Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETF Series Solutions has no effect on the direction of ETFis Series i.e., ETFis Series and ETF Series go up and down completely randomly.
Pair Corralation between ETFis Series and ETF Series
Given the investment horizon of 90 days ETFis Series is expected to generate 1.5 times less return on investment than ETF Series. But when comparing it to its historical volatility, ETFis Series Trust is 1.93 times less risky than ETF Series. It trades about 0.12 of its potential returns per unit of risk. ETF Series Solutions is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,672 in ETF Series Solutions on August 26, 2024 and sell it today you would earn a total of 679.00 from holding ETF Series Solutions or generate 25.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ETFis Series Trust vs. ETF Series Solutions
Performance |
| Timeline |
| ETFis Series Trust |
| ETF Series Solutions |
ETFis Series and ETF Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETFis Series and ETF Series
The main advantage of trading using opposite ETFis Series and ETF Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETFis Series position performs unexpectedly, ETF Series 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 ETF Series will offset losses from the drop in ETF Series' long position.| ETFis Series vs. ETF Series Solutions | ETFis Series vs. Aquagold International | ETFis Series vs. Morningstar Unconstrained Allocation | ETFis Series vs. High Yield Municipal Fund |
| ETF Series vs. Tidal Trust II | ETF Series vs. Tidal Trust II | ETF Series vs. First Trust Dorsey | ETF Series vs. Direxion Daily META |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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