Correlation Between Pershing Square and IShares France
Can any of the company-specific risk be diversified away by investing in both Pershing Square and IShares France 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 Pershing Square and IShares France into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pershing Square Holdings and iShares France Govt, you can compare the effects of market volatilities on Pershing Square and IShares France 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 Pershing Square with a short position of IShares France. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pershing Square and IShares France.
Diversification Opportunities for Pershing Square and IShares France
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Pershing and IShares is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Pershing Square Holdings and iShares France Govt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares France Govt and Pershing Square 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 Pershing Square Holdings are associated (or correlated) with IShares France. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares France Govt has no effect on the direction of Pershing Square i.e., Pershing Square and IShares France go up and down completely randomly.
Pair Corralation between Pershing Square and IShares France
Assuming the 90 days trading horizon Pershing Square Holdings is expected to under-perform the IShares France. In addition to that, Pershing Square is 4.63 times more volatile than iShares France Govt. It trades about -0.02 of its total potential returns per unit of risk. iShares France Govt is currently generating about 0.05 per unit of volatility. If you would invest 12,821 in iShares France Govt on September 3, 2024 and sell it today you would earn a total of 362.00 from holding iShares France Govt or generate 2.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pershing Square Holdings vs. iShares France Govt
Performance |
| Timeline |
| Pershing Square Holdings |
| iShares France Govt |
Pershing Square and IShares France Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pershing Square and IShares France
The main advantage of trading using opposite Pershing Square and IShares France positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pershing Square position performs unexpectedly, IShares France 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 France will offset losses from the drop in IShares France's long position.| Pershing Square vs. Companhia Paranaense de | Pershing Square vs. Quest For Growth | Pershing Square vs. Hydratec Industries NV | Pershing Square vs. iShares Property Yield |
| IShares France vs. Vanguard SP 500 | IShares France vs. SPDR Dow Jones | IShares France vs. iShares Core MSCI | IShares France vs. iShares SP 500 |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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