Correlation Between IShares and MOON

Can any of the company-specific risk be diversified away by investing in both IShares and MOON 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 and MOON into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between IShares and MOON, you can compare the effects of market volatilities on IShares and MOON 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 with a short position of MOON. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares and MOON.

Diversification Opportunities for IShares and MOON

0.0

Correlation Coefficient

IShares  MOON

Pay attention - limited upside

The 3 months correlation between IShares and MOON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding IShares and MOON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOON and IShares 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 are associated (or correlated) with MOON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOON has no effect on the direction of IShares i.e., IShares and MOON go up and down completely randomly.

Pair Corralation between IShares and MOON

If you would invest (100.00) in MOON on December 29, 2024 and sell it today you would earn a total of  100.00  from holding MOON or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

IShares  vs.  MOON

IShares

Risk-Adjusted Performance

Very Weak

Over the last 90 days IShares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, IShares is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

MOON

Risk-Adjusted Performance

Very Weak

Over the last 90 days MOON has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, MOON is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with IShares and MOON

The main advantage of trading using opposite IShares and MOON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares position performs unexpectedly, MOON 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 MOON will offset losses from the drop in MOON's long position.

The idea behind IShares and MOON pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.