Correlation Between IShares Blockchain and SAMMON

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

By analyzing existing cross correlation between iShares Blockchain and and SAMMON 475 08 APR 32, you can compare the effects of market volatilities on IShares Blockchain and SAMMON 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 Blockchain with a short position of SAMMON. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Blockchain and SAMMON.

Diversification Opportunities for IShares Blockchain and SAMMON

0.77

Correlation Coefficient

IShares Blockchain  SAMMON

Poor diversification

The 3 months correlation between IShares and SAMMON is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding iShares Blockchain and and SAMMON 475 08 APR 32 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMMON 475 08 and IShares Blockchain 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 Blockchain and are associated (or correlated) with SAMMON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMMON 475 08 has no effect on the direction of IShares Blockchain i.e., IShares Blockchain and SAMMON go up and down completely randomly.

Pair Corralation between IShares Blockchain and SAMMON

Given the investment horizon of 90 days iShares Blockchain and is expected to generate 1.5 times more return on investment than SAMMON. However, IShares Blockchain is 1.5 times more volatile than SAMMON 475 08 APR 32. It trades about -0.13 of its potential returns per unit of risk. SAMMON 475 08 APR 32 is currently generating about -0.71 per unit of risk. If you would invest  4,227  in iShares Blockchain and on September 28, 2024 and sell it today you would lose (508.00) from holding iShares Blockchain and or give up 12.02% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	35.0%
Values	Daily Returns

iShares Blockchain and  vs.  SAMMON 475 08 APR 32

iShares Blockchain and

Risk-Adjusted Performance

8 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Blockchain and are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain essential indicators, IShares Blockchain exhibited solid returns over the last few months and may actually be approaching a breakup point.

SAMMON 475 08

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SAMMON 475 08 APR 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for SAMMON 475 08 APR 32 investors.

Pair Trading with IShares Blockchain and SAMMON

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

The idea behind iShares Blockchain and and SAMMON 475 08 APR 32 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.