Correlation Between IShares Equity and BGF Euro
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By analyzing existing cross correlation between iShares Equity Enhanced and BGF Euro Markets, you can compare the effects of market volatilities on IShares Equity and BGF Euro 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 Equity with a short position of BGF Euro. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Equity and BGF Euro.
Diversification Opportunities for IShares Equity and BGF Euro
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IShares and BGF is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding iShares Equity Enhanced and BGF Euro Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF Euro Markets and IShares Equity 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 Equity Enhanced are associated (or correlated) with BGF Euro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGF Euro Markets has no effect on the direction of IShares Equity i.e., IShares Equity and BGF Euro go up and down completely randomly.
Pair Corralation between IShares Equity and BGF Euro
Assuming the 90 days trading horizon iShares Equity Enhanced is expected to generate 0.89 times more return on investment than BGF Euro. However, iShares Equity Enhanced is 1.12 times less risky than BGF Euro. It trades about 0.15 of its potential returns per unit of risk. BGF Euro Markets is currently generating about 0.03 per unit of risk. If you would invest 471.00 in iShares Equity Enhanced on September 14, 2024 and sell it today you would earn a total of 66.00 from holding iShares Equity Enhanced or generate 14.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 45.97% |
| Values | Daily Returns |
iShares Equity Enhanced vs. BGF Euro Markets
Performance |
| Timeline |
| iShares Equity Enhanced |
| BGF Euro Markets |
IShares Equity and BGF Euro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Equity and BGF Euro
The main advantage of trading using opposite IShares Equity and BGF Euro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Equity position performs unexpectedly, BGF Euro 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 BGF Euro will offset losses from the drop in BGF Euro's long position.| IShares Equity vs. Groupama Entreprises N | IShares Equity vs. Renaissance Europe C | IShares Equity vs. Superior Plus Corp | IShares Equity vs. Origin Agritech |
| BGF Euro vs. Esfera Robotics R | BGF Euro vs. R co Valor F | BGF Euro vs. CM AM Monplus NE | BGF Euro vs. IE00B0H4TS55 |
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.
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