Correlation Between Innovator ETFs and BNY Mellon
Can any of the company-specific risk be diversified away by investing in both Innovator ETFs and BNY Mellon 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 ETFs and BNY Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator ETFs Trust and BNY Mellon ETF, you can compare the effects of market volatilities on Innovator ETFs and BNY Mellon 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 ETFs with a short position of BNY Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator ETFs and BNY Mellon.
Diversification Opportunities for Innovator ETFs and BNY Mellon
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Innovator and BNY is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Innovator ETFs Trust and BNY Mellon ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNY Mellon ETF and Innovator ETFs 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 ETFs Trust are associated (or correlated) with BNY Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNY Mellon ETF has no effect on the direction of Innovator ETFs i.e., Innovator ETFs and BNY Mellon go up and down completely randomly.
Pair Corralation between Innovator ETFs and BNY Mellon
Given the investment horizon of 90 days Innovator ETFs Trust is expected to generate 0.55 times more return on investment than BNY Mellon. However, Innovator ETFs Trust is 1.81 times less risky than BNY Mellon. It trades about 0.1 of its potential returns per unit of risk. BNY Mellon ETF is currently generating about -0.04 per unit of risk. If you would invest 2,724 in Innovator ETFs Trust on August 26, 2024 and sell it today you would earn a total of 170.00 from holding Innovator ETFs Trust or generate 6.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator ETFs Trust vs. BNY Mellon ETF
Performance |
| Timeline |
| Innovator ETFs Trust |
| BNY Mellon ETF |
Innovator ETFs and BNY Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator ETFs and BNY Mellon
The main advantage of trading using opposite Innovator ETFs and BNY Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator ETFs position performs unexpectedly, BNY Mellon 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 BNY Mellon will offset losses from the drop in BNY Mellon's long position.| Innovator ETFs vs. First Trust Cboe | Innovator ETFs vs. FT Cboe Vest | Innovator ETFs vs. Innovator SP 500 | Innovator ETFs vs. FT Cboe Vest |
| BNY Mellon vs. Associates First Capital | BNY Mellon vs. First Trust S Network | BNY Mellon vs. AirBoss of America |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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