Correlation Between IShares Russell and Nt Non-us

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

By analyzing existing cross correlation between iShares Russell 2000 and Nt Non US Intrinsic, you can compare the effects of market volatilities on IShares Russell and Nt Non-us 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 Russell with a short position of Nt Non-us. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Russell and Nt Non-us.

Diversification Opportunities for IShares Russell and Nt Non-us

0.75

Correlation Coefficient

IShares Russell  Nt Non-us

Poor diversification

The 3 months correlation between IShares and ANTGX is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding iShares Russell 2000 and Nt Non US Intrinsic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nt Non Intrinsic and IShares Russell 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 Russell 2000 are associated (or correlated) with Nt Non-us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nt Non Intrinsic has no effect on the direction of IShares Russell i.e., IShares Russell and Nt Non-us go up and down completely randomly.

Pair Corralation between IShares Russell and Nt Non-us

Considering the 90-day investment horizon iShares Russell 2000 is expected to generate 0.98 times more return on investment than Nt Non-us. However, iShares Russell 2000 is 1.02 times less risky than Nt Non-us. It trades about 0.27 of its potential returns per unit of risk. Nt Non US Intrinsic is currently generating about 0.08 per unit of risk. If you would invest  20,719  in iShares Russell 2000 on July 8, 2024 and sell it today you would earn a total of  1,196  from holding iShares Russell 2000 or generate 5.77% return on investment over 90 days.

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

iShares Russell 2000  vs.  Nt Non US Intrinsic

iShares Russell 2000

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Russell 2000 are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, IShares Russell may actually be approaching a critical reversion point that can send shares even higher in November 2024.

Nt Non Intrinsic

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nt Non US Intrinsic are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Nt Non-us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IShares Russell and Nt Non-us

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

The idea behind iShares Russell 2000 and Nt Non US Intrinsic 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.

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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.