Correlation Between IShares Global and IShares Global
Can any of the company-specific risk be diversified away by investing in both IShares Global and IShares Global 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 IShares Global and IShares Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Global Consumer and iShares Global Financials, you can compare the effects of market volatilities on IShares Global and IShares Global 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 IShares Global with a short position of IShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Global and IShares Global.
Diversification Opportunities for IShares Global and IShares Global
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and IShares is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding iShares Global Consumer and iShares Global Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Global Financials and IShares Global 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 iShares Global Consumer are associated (or correlated) with IShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Global Financials has no effect on the direction of IShares Global i.e., IShares Global and IShares Global go up and down completely randomly.
Pair Corralation between IShares Global and IShares Global
Considering the 90-day investment horizon IShares Global is expected to generate 5.96 times less return on investment than IShares Global. In addition to that, IShares Global is 1.07 times more volatile than iShares Global Financials. It trades about 0.03 of its total potential returns per unit of risk. iShares Global Financials is currently generating about 0.18 per unit of volatility. If you would invest 9,619 in iShares Global Financials on October 23, 2024 and sell it today you would earn a total of 300.00 from holding iShares Global Financials or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Global Consumer vs. iShares Global Financials
Performance |
| Timeline |
| iShares Global Consumer |
| iShares Global Financials |
IShares Global and IShares Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Global and IShares Global
The main advantage of trading using opposite IShares Global and IShares Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Global position performs unexpectedly, IShares Global 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 Global will offset losses from the drop in IShares Global's long position.| IShares Global vs. iShares Global Industrials | IShares Global vs. iShares Global Consumer | IShares Global vs. iShares Global Utilities | IShares Global vs. iShares Global Materials |
| IShares Global vs. iShares Global Comm | IShares Global vs. iShares Global Healthcare | IShares Global vs. iShares Global Tech | IShares Global vs. iShares Financial Services |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |