Correlation Between IShares Intl and VanEck International

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both IShares Intl and VanEck International 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 Intl and VanEck International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Intl High and VanEck International High, you can compare the effects of market volatilities on IShares Intl and VanEck International 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 Intl with a short position of VanEck International. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Intl and VanEck International.

Diversification Opportunities for IShares Intl and VanEck International

0.6
  Correlation Coefficient

Poor diversification

The 3 months correlation between IShares and VanEck is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding iShares Intl High and VanEck International High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck International High and IShares Intl 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 Intl High are associated (or correlated) with VanEck International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck International High has no effect on the direction of IShares Intl i.e., IShares Intl and VanEck International go up and down completely randomly.

Pair Corralation between IShares Intl and VanEck International

Given the investment horizon of 90 days iShares Intl High is expected to generate 0.99 times more return on investment than VanEck International. However, iShares Intl High is 1.01 times less risky than VanEck International. It trades about 0.15 of its potential returns per unit of risk. VanEck International High is currently generating about 0.1 per unit of risk. If you would invest  4,388  in iShares Intl High on October 20, 2024 and sell it today you would earn a total of  40.00  from holding iShares Intl High or generate 0.91% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.0%
ValuesDaily Returns

iShares Intl High  vs.  VanEck International High

 Performance 
       Timeline  
iShares Intl High 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days iShares Intl High has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, IShares Intl is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
VanEck International High 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days VanEck International High has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical indicators, VanEck International is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

IShares Intl and VanEck International Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares Intl and VanEck International

The main advantage of trading using opposite IShares Intl and VanEck International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Intl position performs unexpectedly, VanEck International 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 VanEck International will offset losses from the drop in VanEck International's long position.
The idea behind iShares Intl High and VanEck International High 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.

Other Complementary Tools

FinTech Suite
Use AI to screen and filter profitable investment opportunities
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments