Correlation Between IShares IBonds and IShares 25
Can any of the company-specific risk be diversified away by investing in both IShares IBonds and IShares 25 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 IBonds and IShares 25 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares iBonds Dec and iShares 25 Year, you can compare the effects of market volatilities on IShares IBonds and IShares 25 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 IBonds with a short position of IShares 25. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares IBonds and IShares 25.
Diversification Opportunities for IShares IBonds and IShares 25
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and IShares is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding iShares iBonds Dec and iShares 25 Year in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares 25 Year and IShares IBonds 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 iBonds Dec are associated (or correlated) with IShares 25. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares 25 Year has no effect on the direction of IShares IBonds i.e., IShares IBonds and IShares 25 go up and down completely randomly.
Pair Corralation between IShares IBonds and IShares 25
Given the investment horizon of 90 days iShares iBonds Dec is expected to generate 0.26 times more return on investment than IShares 25. However, iShares iBonds Dec is 3.87 times less risky than IShares 25. It trades about -0.16 of its potential returns per unit of risk. iShares 25 Year is currently generating about -0.2 per unit of risk. If you would invest 2,125 in iShares iBonds Dec on February 3, 2024 and sell it today you would lose (24.00) from holding iShares iBonds Dec or give up 1.13% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
iShares iBonds Dec vs. iShares 25 Year
Performance |
Timeline |
iShares iBonds Dec |
iShares 25 Year |
IShares IBonds and IShares 25 Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IShares IBonds and IShares 25
The main advantage of trading using opposite IShares IBonds and IShares 25 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares IBonds position performs unexpectedly, IShares 25 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 25 will offset losses from the drop in IShares 25's long position.IShares IBonds vs. Invesco BulletShares 2026 | IShares IBonds vs. Invesco BulletShares 2025 | IShares IBonds vs. Invesco BulletShares 2028 | IShares IBonds vs. Invesco BulletShares 2024 |
IShares 25 vs. iShares Treasury Floating | IShares 25 vs. iShares iBonds Dec | IShares 25 vs. iShares iBonds Dec | IShares 25 vs. iShares 0 3 Month |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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