Correlation Between IShares SPTSX and IShares India
Can any of the company-specific risk be diversified away by investing in both IShares SPTSX and IShares India 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 SPTSX and IShares India into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares SPTSX Small and iShares India Index, you can compare the effects of market volatilities on IShares SPTSX and IShares India 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 SPTSX with a short position of IShares India. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SPTSX and IShares India.
Diversification Opportunities for IShares SPTSX and IShares India
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and IShares is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding iShares SPTSX Small and iShares India Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares India Index and IShares SPTSX 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 SPTSX Small are associated (or correlated) with IShares India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares India Index has no effect on the direction of IShares SPTSX i.e., IShares SPTSX and IShares India go up and down completely randomly.
Pair Corralation between IShares SPTSX and IShares India
Assuming the 90 days trading horizon iShares SPTSX Small is expected to generate 1.49 times more return on investment than IShares India. However, IShares SPTSX is 1.49 times more volatile than iShares India Index. It trades about 0.03 of its potential returns per unit of risk. iShares India Index is currently generating about -0.01 per unit of risk. If you would invest 2,046 in iShares SPTSX Small on December 30, 2024 and sell it today you would earn a total of 41.00 from holding iShares SPTSX Small or generate 2.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
iShares SPTSX Small vs. iShares India Index
Performance |
Timeline |
iShares SPTSX Small |
iShares India Index |
IShares SPTSX and IShares India Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IShares SPTSX and IShares India
The main advantage of trading using opposite IShares SPTSX and IShares India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares SPTSX position performs unexpectedly, IShares India 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 India will offset losses from the drop in IShares India's long position.IShares SPTSX vs. iShares Convertible Bond | IShares SPTSX vs. iShares SP Mid Cap | IShares SPTSX vs. iShares Edge MSCI | IShares SPTSX vs. iShares Flexible Monthly |
IShares India vs. iShares China | IShares India vs. iShares MSCI Emerging | IShares India vs. iShares Global Infrastructure | IShares India vs. iShares IG Corporate |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |