Correlation Between IShares Factors and First Trust
Can any of the company-specific risk be diversified away by investing in both IShares Factors and First Trust 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 Factors and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Factors Growth and First Trust Large, you can compare the effects of market volatilities on IShares Factors and First Trust 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 Factors with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Factors and First Trust.
Diversification Opportunities for IShares Factors and First Trust
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IShares and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares Factors Growth and First Trust Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Large and IShares Factors 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 Factors Growth are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Large has no effect on the direction of IShares Factors i.e., IShares Factors and First Trust go up and down completely randomly.
Pair Corralation between IShares Factors and First Trust
If you would invest (100.00) in iShares Factors Growth on December 5, 2024 and sell it today you would earn a total of 100.00 from holding iShares Factors Growth or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
iShares Factors Growth vs. First Trust Large
Performance |
Timeline |
iShares Factors Growth |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
First Trust Large |
IShares Factors and First Trust Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IShares Factors and First Trust
The main advantage of trading using opposite IShares Factors and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Factors position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.IShares Factors vs. iShares ESG Advanced | IShares Factors vs. iShares Focused Value | IShares Factors vs. iShares MSCI USA |
First Trust vs. First Trust Large | First Trust vs. First Trust Small | First Trust vs. First Trust Large | First Trust vs. First Trust Mid |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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