Correlation Between Procter Gamble and IShares Currency
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and IShares Currency 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 Procter Gamble and IShares Currency into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and iShares Currency Hedged, you can compare the effects of market volatilities on Procter Gamble and IShares Currency 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 Procter Gamble with a short position of IShares Currency. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and IShares Currency.
Diversification Opportunities for Procter Gamble and IShares Currency
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Procter and IShares is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and iShares Currency Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Currency Hedged and Procter Gamble 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 Procter Gamble are associated (or correlated) with IShares Currency. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Currency Hedged has no effect on the direction of Procter Gamble i.e., Procter Gamble and IShares Currency go up and down completely randomly.
Pair Corralation between Procter Gamble and IShares Currency
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 1.89 times more return on investment than IShares Currency. However, Procter Gamble is 1.89 times more volatile than iShares Currency Hedged. It trades about 0.15 of its potential returns per unit of risk. iShares Currency Hedged is currently generating about 0.0 per unit of risk. If you would invest 16,962 in Procter Gamble on August 25, 2024 and sell it today you would earn a total of 666.00 from holding Procter Gamble or generate 3.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. iShares Currency Hedged
Performance |
| Timeline |
| Procter Gamble |
| iShares Currency Hedged |
Procter Gamble and IShares Currency Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and IShares Currency
The main advantage of trading using opposite Procter Gamble and IShares Currency positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, IShares Currency 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 Currency will offset losses from the drop in IShares Currency's long position.| Procter Gamble vs. Eshallgo Class A | Procter Gamble vs. Amtech Systems | Procter Gamble vs. Gold Fields Ltd | Procter Gamble vs. Aegean Airlines SA |
| IShares Currency vs. Dimensional Core Equity | IShares Currency vs. Dimensional Emerging Core | IShares Currency vs. Dimensional Targeted Value | IShares Currency vs. Dimensional Small Cap |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |