Correlation Between IShares ESG and CI Enhanced
Can any of the company-specific risk be diversified away by investing in both IShares ESG and CI Enhanced 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 ESG and CI Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares ESG Aware and CI Enhanced Short, you can compare the effects of market volatilities on IShares ESG and CI Enhanced 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 ESG with a short position of CI Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares ESG and CI Enhanced.
Diversification Opportunities for IShares ESG and CI Enhanced
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and FSB is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding iShares ESG Aware and CI Enhanced Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Enhanced Short and IShares ESG 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 ESG Aware are associated (or correlated) with CI Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Enhanced Short has no effect on the direction of IShares ESG i.e., IShares ESG and CI Enhanced go up and down completely randomly.
Pair Corralation between IShares ESG and CI Enhanced
Assuming the 90 days trading horizon iShares ESG Aware is expected to generate 5.63 times more return on investment than CI Enhanced. However, IShares ESG is 5.63 times more volatile than CI Enhanced Short. It trades about 0.32 of its potential returns per unit of risk. CI Enhanced Short is currently generating about 0.13 per unit of risk. If you would invest 2,009 in iShares ESG Aware on April 21, 2025 and sell it today you would earn a total of 393.00 from holding iShares ESG Aware or generate 19.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
iShares ESG Aware vs. CI Enhanced Short
Performance |
Timeline |
iShares ESG Aware |
CI Enhanced Short |
IShares ESG and CI Enhanced Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with IShares ESG and CI Enhanced
The main advantage of trading using opposite IShares ESG and CI Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares ESG position performs unexpectedly, CI Enhanced 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 CI Enhanced will offset losses from the drop in CI Enhanced's long position.IShares ESG vs. iShares ESG Aware | IShares ESG vs. iShares ESG MSCI | IShares ESG vs. iShares ESG Aware | IShares ESG vs. iShares ESG Aware |
CI Enhanced vs. CI Canadian Convertible | CI Enhanced vs. CI Enhanced Government | CI Enhanced vs. CI Investment Grade | CI Enhanced vs. CI Preferred Share |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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