Correlation Between Tema ETF and IShares Short
Can any of the company-specific risk be diversified away by investing in both Tema ETF and IShares Short 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 Tema ETF and IShares Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tema ETF Trust and iShares Short Maturity, you can compare the effects of market volatilities on Tema ETF and IShares Short 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 Tema ETF with a short position of IShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tema ETF and IShares Short.
Diversification Opportunities for Tema ETF and IShares Short
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tema and IShares is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Tema ETF Trust and iShares Short Maturity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Short Maturity and Tema ETF 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 Tema ETF Trust are associated (or correlated) with IShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Short Maturity has no effect on the direction of Tema ETF i.e., Tema ETF and IShares Short go up and down completely randomly.
Pair Corralation between Tema ETF and IShares Short
Considering the 90-day investment horizon Tema ETF Trust is expected to under-perform the IShares Short. In addition to that, Tema ETF is 15.32 times more volatile than iShares Short Maturity. It trades about 0.0 of its total potential returns per unit of risk. iShares Short Maturity is currently generating about 0.23 per unit of volatility. If you would invest 4,673 in iShares Short Maturity on December 2, 2024 and sell it today you would earn a total of 363.00 from holding iShares Short Maturity or generate 7.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 91.52% |
Values | Daily Returns |
Tema ETF Trust vs. iShares Short Maturity
Performance |
Timeline |
Tema ETF Trust |
iShares Short Maturity |
Tema ETF and IShares Short Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tema ETF and IShares Short
The main advantage of trading using opposite Tema ETF and IShares Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tema ETF position performs unexpectedly, IShares Short 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 Short will offset losses from the drop in IShares Short's long position.Tema ETF vs. Smith Nephew SNATS | Tema ETF vs. Fresenius Medical Care | Tema ETF vs. Fomento Economico Mexicano | Tema ETF vs. The Cooper Companies, |
IShares Short vs. iShares Treasury Floating | IShares Short vs. iShares Short Term National | IShares Short vs. iShares Short Maturity | IShares Short vs. iShares Interest Rate |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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