Correlation Between IShares Emergent and Oshidori International

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

By analyzing existing cross correlation between iShares Emergent Food and Oshidori International Holdings, you can compare the effects of market volatilities on IShares Emergent and Oshidori 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 Emergent with a short position of Oshidori International. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Emergent and Oshidori International.

Diversification Opportunities for IShares Emergent and Oshidori International

0.0

Correlation Coefficient

IShares Emergent  Oshidori International

Pay attention - limited upside

The 3 months correlation between IShares and Oshidori is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares Emergent Food and Oshidori International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oshidori International and IShares Emergent 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 Emergent Food are associated (or correlated) with Oshidori International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oshidori International has no effect on the direction of IShares Emergent i.e., IShares Emergent and Oshidori International go up and down completely randomly.

Pair Corralation between IShares Emergent and Oshidori International

If you would invest  1,964  in iShares Emergent Food on December 30, 2024 and sell it today you would earn a total of  47.00  from holding iShares Emergent Food or generate 2.39% return on investment over 90 days.

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

iShares Emergent Food  vs.  Oshidori International Holding

iShares Emergent Food

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Emergent Food are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, IShares Emergent is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Oshidori International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Oshidori International Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Oshidori International is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with IShares Emergent and Oshidori International

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

The idea behind iShares Emergent Food and Oshidori International Holdings 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.