Correlation Between US GASOLINE and IShares Trust
Can any of the company-specific risk be diversified away by investing in both US GASOLINE 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 US GASOLINE and IShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US GASOLINE FUND and iShares Trust , you can compare the effects of market volatilities on US GASOLINE 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 US GASOLINE with a short position of IShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of US GASOLINE and IShares Trust.
Diversification Opportunities for US GASOLINE and IShares Trust
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UGA and IShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding US GASOLINE FUND and iShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Trust and US GASOLINE 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 US GASOLINE FUND 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 US GASOLINE i.e., US GASOLINE and IShares Trust go up and down completely randomly.
Pair Corralation between US GASOLINE and IShares Trust
If you would invest 314,802 in iShares Trust on September 20, 2024 and sell it today you would earn a total of 27,813 from holding iShares Trust or generate 8.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US GASOLINE FUND vs. iShares Trust
Performance |
| Timeline |
| US GASOLINE FUND |
| iShares Trust |
US GASOLINE and IShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US GASOLINE and IShares Trust
The main advantage of trading using opposite US GASOLINE and IShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US GASOLINE 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.| US GASOLINE vs. iShares Trust | US GASOLINE vs. Vanguard Funds Public | US GASOLINE vs. Vanguard Specialized Funds | US GASOLINE vs. First Trust Developed |
| IShares Trust vs. Vanguard Index Funds | IShares Trust vs. Vanguard Index Funds | IShares Trust vs. SPDR SP 500 | IShares Trust vs. Vanguard Bond Index |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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