Correlation Between IShares Asia and Add Value

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

By analyzing existing cross correlation between iShares Asia Pacific and Add Value Fund, you can compare the effects of market volatilities on IShares Asia and Add Value 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 Asia with a short position of Add Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Asia and Add Value.

Diversification Opportunities for IShares Asia and Add Value

-0.12

Correlation Coefficient

IShares Asia  Add Value

Good diversification

The 3 months correlation between IShares and Add is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding iShares Asia Pacific and Add Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Add Value Fund and IShares Asia 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 Asia Pacific are associated (or correlated) with Add Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Add Value Fund has no effect on the direction of IShares Asia i.e., IShares Asia and Add Value go up and down completely randomly.

Pair Corralation between IShares Asia and Add Value

Assuming the 90 days trading horizon iShares Asia Pacific is expected to generate 0.5 times more return on investment than Add Value. However, iShares Asia Pacific is 2.02 times less risky than Add Value. It trades about 0.3 of its potential returns per unit of risk. Add Value Fund is currently generating about 0.04 per unit of risk. If you would invest  2,024  in iShares Asia Pacific on May 28, 2025 and sell it today you would earn a total of  238.00  from holding iShares Asia Pacific or generate 11.76% return on investment over 90 days.

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

iShares Asia Pacific  vs.  Add Value Fund

iShares Asia Pacific

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Asia Pacific are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, IShares Asia may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Add Value Fund

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Add Value Fund are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Add Value is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IShares Asia and Add Value

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

The idea behind iShares Asia Pacific and Add Value Fund 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.