Correlation Between IShares Core and Tuttle Capital

Can any of the company-specific risk be diversified away by investing in both IShares Core and Tuttle Capital 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 Tuttle Capital 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 Tuttle Capital Short, you can compare the effects of market volatilities on IShares Core and Tuttle Capital 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 Tuttle Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Tuttle Capital.

Diversification Opportunities for IShares Core and Tuttle Capital

-0.95

Correlation Coefficient

IShares Core  Tuttle Capital

Pay attention - limited upside

The 3 months correlation between IShares and Tuttle is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and Tuttle Capital Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tuttle Capital Short 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 Tuttle Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tuttle Capital Short has no effect on the direction of IShares Core i.e., IShares Core and Tuttle Capital go up and down completely randomly.

Pair Corralation between IShares Core and Tuttle Capital

Considering the 90-day investment horizon iShares Core SP is expected to under-perform the Tuttle Capital. But the etf apears to be less risky and, when comparing its historical volatility, iShares Core SP is 5.83 times less risky than Tuttle Capital. The etf trades about -0.08 of its potential returns per unit of risk. The Tuttle Capital Short is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  4,079  in Tuttle Capital Short on December 28, 2024 and sell it today you would earn a total of  873.00  from holding Tuttle Capital Short or generate 21.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

iShares Core SP  vs.  Tuttle Capital Short

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 fairly stable basic indicators, IShares Core is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Tuttle Capital Short

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tuttle Capital Short are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Tuttle Capital disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IShares Core and Tuttle Capital

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

The idea behind iShares Core SP and Tuttle Capital Short 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.