Correlation Between IShares Diversified and Cardano Impact

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Can any of the company-specific risk be diversified away by investing in both IShares Diversified and Cardano Impact 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 Diversified and Cardano Impact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Diversified Commodity and Cardano Impact Equity, you can compare the effects of market volatilities on IShares Diversified and Cardano Impact 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 Diversified with a short position of Cardano Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Diversified and Cardano Impact.

Diversification Opportunities for IShares Diversified and Cardano Impact

0.31
  Correlation Coefficient

Weak diversification

The 3 months correlation between IShares and Cardano is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding iShares Diversified Commodity and Cardano Impact Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardano Impact Equity and IShares Diversified 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 Diversified Commodity are associated (or correlated) with Cardano Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardano Impact Equity has no effect on the direction of IShares Diversified i.e., IShares Diversified and Cardano Impact go up and down completely randomly.

Pair Corralation between IShares Diversified and Cardano Impact

Assuming the 90 days trading horizon IShares Diversified is expected to generate 3.67 times less return on investment than Cardano Impact. But when comparing it to its historical volatility, iShares Diversified Commodity is 1.41 times less risky than Cardano Impact. It trades about 0.07 of its potential returns per unit of risk. Cardano Impact Equity is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  4,674  in Cardano Impact Equity on April 24, 2025 and sell it today you would earn a total of  560.00  from holding Cardano Impact Equity or generate 11.98% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy98.44%
ValuesDaily Returns

iShares Diversified Commodity  vs.  Cardano Impact Equity

 Performance 
       Timeline  
iShares Diversified 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in iShares Diversified Commodity are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, IShares Diversified is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
Cardano Impact Equity 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Cardano Impact Equity are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively uncertain basic indicators, Cardano Impact may actually be approaching a critical reversion point that can send shares even higher in August 2025.

IShares Diversified and Cardano Impact Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares Diversified and Cardano Impact

The main advantage of trading using opposite IShares Diversified and Cardano Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Diversified position performs unexpectedly, Cardano Impact 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 Cardano Impact will offset losses from the drop in Cardano Impact's long position.
The idea behind iShares Diversified Commodity and Cardano Impact Equity 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.

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