Correlation Between BetaShares Crypto and ISharesGlobal 100

Can any of the company-specific risk be diversified away by investing in both BetaShares Crypto and ISharesGlobal 100 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 BetaShares Crypto and ISharesGlobal 100 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BetaShares Crypto Innovators and iSharesGlobal 100, you can compare the effects of market volatilities on BetaShares Crypto and ISharesGlobal 100 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 BetaShares Crypto with a short position of ISharesGlobal 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of BetaShares Crypto and ISharesGlobal 100.

Diversification Opportunities for BetaShares Crypto and ISharesGlobal 100

0.1

Correlation Coefficient

BetaShares Crypto  ISharesGlobal 100

Average diversification

The 3 months correlation between BetaShares and ISharesGlobal is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding BetaShares Crypto Innovators and iSharesGlobal 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSharesGlobal 100 and BetaShares Crypto 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 BetaShares Crypto Innovators are associated (or correlated) with ISharesGlobal 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSharesGlobal 100 has no effect on the direction of BetaShares Crypto i.e., BetaShares Crypto and ISharesGlobal 100 go up and down completely randomly.

Pair Corralation between BetaShares Crypto and ISharesGlobal 100

Assuming the 90 days trading horizon BetaShares Crypto Innovators is expected to under-perform the ISharesGlobal 100. In addition to that, BetaShares Crypto is 6.07 times more volatile than iSharesGlobal 100. It trades about -0.11 of its total potential returns per unit of risk. iSharesGlobal 100 is currently generating about -0.03 per unit of volatility. If you would invest  16,176  in iSharesGlobal 100 on December 2, 2024 and sell it today you would lose (146.00) from holding iSharesGlobal 100 or give up 0.9% of portfolio value over 90 days.

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

BetaShares Crypto Innovators  vs.  iSharesGlobal 100

BetaShares Crypto

Risk-Adjusted Performance

Very Weak

Over the last 90 days BetaShares Crypto Innovators has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

iSharesGlobal 100

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in iSharesGlobal 100 are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, ISharesGlobal 100 is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with BetaShares Crypto and ISharesGlobal 100

The main advantage of trading using opposite BetaShares Crypto and ISharesGlobal 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BetaShares Crypto position performs unexpectedly, ISharesGlobal 100 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 ISharesGlobal 100 will offset losses from the drop in ISharesGlobal 100's long position.

The idea behind BetaShares Crypto Innovators and iSharesGlobal 100 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.

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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.