Correlation Between IShares Global and IShares Canadian
Can any of the company-specific risk be diversified away by investing in both IShares Global and IShares Canadian 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 Global and IShares Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Global Monthly and iShares Canadian Government, you can compare the effects of market volatilities on IShares Global and IShares Canadian 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 Global with a short position of IShares Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Global and IShares Canadian.
Diversification Opportunities for IShares Global and IShares Canadian
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IShares and IShares is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding iShares Global Monthly and iShares Canadian Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Canadian Gov and IShares Global 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 Global Monthly are associated (or correlated) with IShares Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Canadian Gov has no effect on the direction of IShares Global i.e., IShares Global and IShares Canadian go up and down completely randomly.
Pair Corralation between IShares Global and IShares Canadian
Assuming the 90 days trading horizon iShares Global Monthly is expected to generate 1.86 times more return on investment than IShares Canadian. However, IShares Global is 1.86 times more volatile than iShares Canadian Government. It trades about 0.12 of its potential returns per unit of risk. iShares Canadian Government is currently generating about -0.02 per unit of risk. If you would invest 2,164 in iShares Global Monthly on May 6, 2025 and sell it today you would earn a total of 99.00 from holding iShares Global Monthly or generate 4.57% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
iShares Global Monthly vs. iShares Canadian Government
Performance |
Timeline |
iShares Global Monthly |
iShares Canadian Gov |
IShares Global and IShares Canadian Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IShares Global and IShares Canadian
The main advantage of trading using opposite IShares Global and IShares Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Global position performs unexpectedly, IShares Canadian 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 Canadian will offset losses from the drop in IShares Canadian's long position.IShares Global vs. iShares Global Infrastructure | IShares Global vs. iShares Global Real | IShares Global vs. iShares Dividend Growers | IShares Global vs. iShares 1 5 Year |
IShares Canadian vs. iShares Core Canadian | IShares Canadian vs. iShares Core Canadian | IShares Canadian vs. iShares Canadian Real | IShares Canadian vs. iShares Canadian Value |
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 Stocks Directory module to find actively traded stocks across global markets.
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