Correlation Between Innovator Capital and IPath Series
Can any of the company-specific risk be diversified away by investing in both Innovator Capital and IPath Series 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 Capital and IPath Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator Capital Management and iPath Series B, you can compare the effects of market volatilities on Innovator Capital and IPath Series 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 Capital with a short position of IPath Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator Capital and IPath Series.
Diversification Opportunities for Innovator Capital and IPath Series
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Innovator and IPath is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Innovator Capital Management and iPath Series B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iPath Series B and Innovator Capital 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 Capital Management are associated (or correlated) with IPath Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iPath Series B has no effect on the direction of Innovator Capital i.e., Innovator Capital and IPath Series go up and down completely randomly.
Pair Corralation between Innovator Capital and IPath Series
If you would invest 3,077 in Innovator Capital Management on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Innovator Capital Management or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Innovator Capital Management vs. iPath Series B
Performance |
| Timeline |
| Innovator Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| iPath Series B |
Innovator Capital and IPath Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator Capital and IPath Series
The main advantage of trading using opposite Innovator Capital and IPath Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator Capital position performs unexpectedly, IPath Series 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 IPath Series will offset losses from the drop in IPath Series' long position.| Innovator Capital vs. ProShares VIX Mid Term | Innovator Capital vs. ProShares VIX Short Term | Innovator Capital vs. iPath Series B | Innovator Capital vs. ProShares Short Russell2000 |
| IPath Series vs. ProShares Ultra VIX | IPath Series vs. ProShares Short VIX | IPath Series vs. ProShares UltraPro Short | IPath Series vs. iShares 20 Year |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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