Correlation Between Innovator Capital and Volatility Shares

Can any of the company-specific risk be diversified away by investing in both Innovator Capital and Volatility Shares 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 Innovator Capital and Volatility Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Innovator Capital Management and Volatility Shares Trust, you can compare the effects of market volatilities on Innovator Capital and Volatility Shares 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 Innovator Capital with a short position of Volatility Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator Capital and Volatility Shares.

Diversification Opportunities for Innovator Capital and Volatility Shares

0.0

Correlation Coefficient

Innovator Capital  Volatility Shares

Pay attention - limited upside

The 3 months correlation between Innovator and Volatility is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Innovator Capital Management and Volatility Shares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Volatility Shares Trust and Innovator Capital 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 Innovator Capital Management are associated (or correlated) with Volatility Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Volatility Shares Trust has no effect on the direction of Innovator Capital i.e., Innovator Capital and Volatility Shares go up and down completely randomly.

Pair Corralation between Innovator Capital and Volatility Shares

If you would invest (100.00) in Innovator Capital Management on November 28, 2024 and sell it today you would earn a total of  100.00  from holding Innovator Capital Management 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

Innovator Capital Management  vs.  Volatility Shares Trust

Innovator Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Innovator Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking indicators, Innovator Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Volatility Shares Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Volatility Shares Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's technical indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Pair Trading with Innovator Capital and Volatility Shares

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

The idea behind Innovator Capital Management and Volatility Shares Trust 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.