Correlation Between IShares Core and CI Galaxy

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

By analyzing existing cross correlation between iShares Core Conservative and CI Galaxy Multi Crypto, you can compare the effects of market volatilities on IShares Core and CI Galaxy 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 CI Galaxy. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and CI Galaxy.

Diversification Opportunities for IShares Core and CI Galaxy

-0.38

Correlation Coefficient

IShares Core  CI Galaxy

Very good diversification

The 3 months correlation between IShares and CMCX-B is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core Conservative and CI Galaxy Multi Crypto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Galaxy Multi 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 Conservative are associated (or correlated) with CI Galaxy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Galaxy Multi has no effect on the direction of IShares Core i.e., IShares Core and CI Galaxy go up and down completely randomly.

Pair Corralation between IShares Core and CI Galaxy

Assuming the 90 days trading horizon iShares Core Conservative is expected to generate 0.19 times more return on investment than CI Galaxy. However, iShares Core Conservative is 5.27 times less risky than CI Galaxy. It trades about -0.01 of its potential returns per unit of risk. CI Galaxy Multi Crypto is currently generating about -0.12 per unit of risk. If you would invest  2,382  in iShares Core Conservative on December 11, 2024 and sell it today you would lose (9.00) from holding iShares Core Conservative or give up 0.38% of portfolio value over 90 days.

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

iShares Core Conservative  vs.  CI Galaxy Multi Crypto

iShares Core Conservative

Risk-Adjusted Performance

Very Weak

Over the last 90 days iShares Core Conservative has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, IShares Core is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

CI Galaxy Multi

Risk-Adjusted Performance

Very Weak

Over the last 90 days CI Galaxy Multi Crypto has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Etf's fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the ETF investors.

Pair Trading with IShares Core and CI Galaxy

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

The idea behind iShares Core Conservative and CI Galaxy Multi Crypto 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.