Correlation Between Innovator Growth and IShares Nasdaq
Can any of the company-specific risk be diversified away by investing in both Innovator Growth and IShares Nasdaq 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 Innovator Growth and IShares Nasdaq into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator Growth 100 Accelerated and iShares Nasdaq 100 ex, you can compare the effects of market volatilities on Innovator Growth and IShares Nasdaq 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 Innovator Growth with a short position of IShares Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator Growth and IShares Nasdaq.
Diversification Opportunities for Innovator Growth and IShares Nasdaq
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Innovator and IShares is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Innovator Growth 100 Accelerat and iShares Nasdaq 100 ex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Nasdaq 100 and Innovator Growth 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 Innovator Growth 100 Accelerated are associated (or correlated) with IShares Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Nasdaq 100 has no effect on the direction of Innovator Growth i.e., Innovator Growth and IShares Nasdaq go up and down completely randomly.
Pair Corralation between Innovator Growth and IShares Nasdaq
If you would invest 2,416 in Innovator Growth 100 Accelerated on August 26, 2024 and sell it today you would earn a total of 1,294 from holding Innovator Growth 100 Accelerated or generate 53.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Innovator Growth 100 Accelerat vs. iShares Nasdaq 100 ex
Performance |
| Timeline |
| Innovator Growth 100 |
| iShares Nasdaq 100 |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Innovator Growth and IShares Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator Growth and IShares Nasdaq
The main advantage of trading using opposite Innovator Growth and IShares Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator Growth position performs unexpectedly, IShares Nasdaq 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 Nasdaq will offset losses from the drop in IShares Nasdaq's long position.| Innovator Growth vs. First Trust Cboe | Innovator Growth vs. FT Cboe Vest | Innovator Growth vs. Innovator SP 500 | Innovator Growth vs. FT Cboe Vest |
| IShares Nasdaq vs. FT Vest Equity | IShares Nasdaq vs. Northern Lights | IShares Nasdaq vs. Dimensional International High | IShares Nasdaq vs. First Trust Exchange Traded |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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