Correlation Between IShares Canadian and IShares Canadian
Can any of the company-specific risk be diversified away by investing in both IShares Canadian and IShares Canadian 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 Canadian and IShares Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Canadian Short and iShares Canadian Value, you can compare the effects of market volatilities on IShares Canadian and IShares Canadian 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 Canadian with a short position of IShares Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Canadian and IShares Canadian.
Diversification Opportunities for IShares Canadian and IShares Canadian
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and IShares is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding iShares Canadian Short and iShares Canadian Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Canadian Value and IShares Canadian 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 Canadian Short are associated (or correlated) with IShares Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Canadian Value has no effect on the direction of IShares Canadian i.e., IShares Canadian and IShares Canadian go up and down completely randomly.
Pair Corralation between IShares Canadian and IShares Canadian
Assuming the 90 days trading horizon iShares Canadian Short is expected to under-perform the IShares Canadian. But the etf apears to be less risky and, when comparing its historical volatility, iShares Canadian Short is 5.34 times less risky than IShares Canadian. The etf trades about -0.16 of its potential returns per unit of risk. The iShares Canadian Value is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 3,909 in iShares Canadian Value on August 26, 2024 and sell it today you would earn a total of 127.00 from holding iShares Canadian Value or generate 3.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Canadian Short vs. iShares Canadian Value
Performance |
| Timeline |
| iShares Canadian Short |
| iShares Canadian Value |
IShares Canadian and IShares Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Canadian and IShares Canadian
The main advantage of trading using opposite IShares Canadian and IShares Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Canadian position performs unexpectedly, IShares Canadian 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 Canadian will offset losses from the drop in IShares Canadian's long position.| IShares Canadian vs. Mackenzie Canadian Aggregate | IShares Canadian vs. Mackenzie Canadian Short | IShares Canadian vs. Mackenzie Core Plus | IShares Canadian vs. Mackenzie Investment Grade |
| IShares Canadian vs. iShares SPTSX 60 | IShares Canadian vs. iShares Core SP | IShares Canadian vs. iShares SPTSX Composite | IShares Canadian vs. iShares Core MSCI |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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