Correlation Between IShares Core and 21Shares Tezos

Can any of the company-specific risk be diversified away by investing in both IShares Core and 21Shares Tezos 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 Core and 21Shares Tezos into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between iShares Core SP and 21Shares Tezos staking, you can compare the effects of market volatilities on IShares Core and 21Shares Tezos 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 Core with a short position of 21Shares Tezos. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and 21Shares Tezos.

Diversification Opportunities for IShares Core and 21Shares Tezos

-0.1

Correlation Coefficient

IShares Core  21Shares Tezos

Good diversification

The 3 months correlation between IShares and 21Shares is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and 21Shares Tezos staking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Tezos staking and IShares Core 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 Core SP are associated (or correlated) with 21Shares Tezos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Tezos staking has no effect on the direction of IShares Core i.e., IShares Core and 21Shares Tezos go up and down completely randomly.

Pair Corralation between IShares Core and 21Shares Tezos

Assuming the 90 days trading horizon iShares Core SP is expected to generate 0.15 times more return on investment than 21Shares Tezos. However, iShares Core SP is 6.69 times less risky than 21Shares Tezos. It trades about -0.04 of its potential returns per unit of risk. 21Shares Tezos staking is currently generating about -0.18 per unit of risk. If you would invest  64,080  in iShares Core SP on December 2, 2024 and sell it today you would lose (1,550) from holding iShares Core SP or give up 2.42% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

iShares Core SP  vs.  21Shares Tezos staking

iShares Core SP

Risk-Adjusted Performance

Very Weak

Over the last 90 days iShares Core SP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, IShares Core is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

21Shares Tezos staking

Risk-Adjusted Performance

Very Weak

Over the last 90 days 21Shares Tezos staking has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

Pair Trading with IShares Core and 21Shares Tezos

The main advantage of trading using opposite IShares Core and 21Shares Tezos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, 21Shares Tezos 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 21Shares Tezos will offset losses from the drop in 21Shares Tezos' long position.

The idea behind iShares Core SP and 21Shares Tezos staking 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.