Correlation Between SHP ETF and IShares Trust
Can any of the company-specific risk be diversified away by investing in both SHP ETF and IShares Trust 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 SHP ETF and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHP ETF Trust and iShares Trust , you can compare the effects of market volatilities on SHP ETF and IShares Trust 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 SHP ETF with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHP ETF and IShares Trust.
Diversification Opportunities for SHP ETF and IShares Trust
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SHP and IShares is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding SHP ETF Trust and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and SHP ETF 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 SHP ETF Trust are associated (or correlated) with IShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Trust has no effect on the direction of SHP ETF i.e., SHP ETF and IShares Trust go up and down completely randomly.
Pair Corralation between SHP ETF and IShares Trust
Given the investment horizon of 90 days SHP ETF Trust is expected to generate 0.63 times more return on investment than IShares Trust. However, SHP ETF Trust is 1.58 times less risky than IShares Trust. It trades about 0.2 of its potential returns per unit of risk. iShares Trust is currently generating about 0.05 per unit of risk. If you would invest 5,082 in SHP ETF Trust on August 29, 2024 and sell it today you would earn a total of 133.00 from holding SHP ETF Trust or generate 2.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SHP ETF Trust vs. iShares Trust
Performance |
| Timeline |
| SHP ETF Trust |
| iShares Trust |
SHP ETF and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHP ETF and IShares Trust
The main advantage of trading using opposite SHP ETF and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHP ETF position performs unexpectedly, IShares Trust 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 Trust will offset losses from the drop in IShares Trust's long position.| SHP ETF vs. Global X SP | SHP ETF vs. Amplify CWP Enhanced | SHP ETF vs. Global X Russell | SHP ETF vs. JPMorgan Nasdaq Equity |
| IShares Trust vs. iShares Trust | IShares Trust vs. iShares Trust | IShares Trust vs. Simplify Volatility Premium | IShares Trust vs. Tidal Trust II |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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