Correlation Between IShares Core and Bridgewater Bancshares

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both IShares Core and Bridgewater Bancshares 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 Bridgewater Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IShares Core SP and Bridgewater Bancshares, you can compare the effects of market volatilities on IShares Core and Bridgewater Bancshares 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 Bridgewater Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Bridgewater Bancshares.

Diversification Opportunities for IShares Core and Bridgewater Bancshares

-0.72
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between IShares and Bridgewater is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding IShares Core SP and Bridgewater Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgewater Bancshares 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 SP are associated (or correlated) with Bridgewater Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgewater Bancshares has no effect on the direction of IShares Core i.e., IShares Core and Bridgewater Bancshares go up and down completely randomly.

Pair Corralation between IShares Core and Bridgewater Bancshares

Given the investment horizon of 90 days IShares Core is expected to generate 1.11 times less return on investment than Bridgewater Bancshares. But when comparing it to its historical volatility, IShares Core SP is 3.12 times less risky than Bridgewater Bancshares. It trades about 0.23 of its potential returns per unit of risk. Bridgewater Bancshares is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  936.00  in Bridgewater Bancshares on December 29, 2023 and sell it today you would earn a total of  212.00  from holding Bridgewater Bancshares or generate 22.65% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy99.19%
ValuesDaily Returns

IShares Core SP  vs.  Bridgewater Bancshares

 Performance 
       Timeline  
IShares Core SP 

Risk-Adjusted Performance

16 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in IShares Core SP are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, IShares Core may actually be approaching a critical reversion point that can send shares even higher in April 2024.
Bridgewater Bancshares 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Bridgewater Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

IShares Core and Bridgewater Bancshares Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares Core and Bridgewater Bancshares

The main advantage of trading using opposite IShares Core and Bridgewater Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Bridgewater Bancshares 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 Bridgewater Bancshares will offset losses from the drop in Bridgewater Bancshares' long position.
The idea behind IShares Core SP and Bridgewater Bancshares 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

Other Complementary Tools

Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
CEOs Directory
Screen CEOs from public companies around the world
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Earnings Calls
Check upcoming earnings announcements updated hourly across public exchanges
Equity Valuation
Check real value of public entities based on technical and fundamental data
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Bonds Directory
Find actively traded corporate debentures issued by US companies