Correlation Between Evolve Cryptocurrencies and IShares Small

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

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

Diversification Opportunities for Evolve Cryptocurrencies and IShares Small

0.9

Correlation Coefficient

Evolve Cryptocurrencies  IShares Small

Almost no diversification

The 3 months correlation between Evolve and IShares is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Cryptocurrencies ETF and iShares Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Small Cap and Evolve Cryptocurrencies 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 Evolve Cryptocurrencies ETF are associated (or correlated) with IShares Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Small Cap has no effect on the direction of Evolve Cryptocurrencies i.e., Evolve Cryptocurrencies and IShares Small go up and down completely randomly.

Pair Corralation between Evolve Cryptocurrencies and IShares Small

Assuming the 90 days trading horizon Evolve Cryptocurrencies ETF is expected to under-perform the IShares Small. In addition to that, Evolve Cryptocurrencies is 2.56 times more volatile than iShares Small Cap. It trades about -0.08 of its total potential returns per unit of risk. iShares Small Cap is currently generating about -0.13 per unit of volatility. If you would invest  4,255  in iShares Small Cap on December 30, 2024 and sell it today you would lose (394.00) from holding iShares Small Cap or give up 9.26% of portfolio value over 90 days.

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

Evolve Cryptocurrencies ETF  vs.  iShares Small Cap

Evolve Cryptocurrencies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Evolve Cryptocurrencies ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the ETF investors.

iShares Small Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days iShares Small Cap has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Pair Trading with Evolve Cryptocurrencies and IShares Small

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

The idea behind Evolve Cryptocurrencies ETF and iShares Small Cap 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.