Correlation Between IShares Trust and Tech Central

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

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

Diversification Opportunities for IShares Trust and Tech Central

0.0

Correlation Coefficient

IShares Trust  Tech Central

Pay attention - limited upside

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

Pair Corralation between IShares Trust and Tech Central

If you would invest  2,475  in iShares Trust on May 3, 2025 and sell it today you would earn a total of  73.00  from holding iShares Trust or generate 2.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

iShares Trust   vs.  Tech Central

iShares Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Trust are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable fundamental indicators, IShares Trust is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Tech Central

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tech Central has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical indicators, Tech Central is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with IShares Trust and Tech Central

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

The idea behind iShares Trust and Tech Central 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.