Correlation Between DHDG and IShares Core
Can any of the company-specific risk be diversified away by investing in both DHDG and IShares Core 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 DHDG and IShares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DHDG and iShares Core Aggregate, you can compare the effects of market volatilities on DHDG and IShares Core 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 DHDG with a short position of IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of DHDG and IShares Core.
Diversification Opportunities for DHDG and IShares Core
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between DHDG and IShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding DHDG and iShares Core Aggregate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Aggregate and DHDG 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 DHDG are associated (or correlated) with IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Aggregate has no effect on the direction of DHDG i.e., DHDG and IShares Core go up and down completely randomly.
Pair Corralation between DHDG and IShares Core
If you would invest 9,589 in iShares Core Aggregate on January 26, 2024 and sell it today you would lose (50.00) from holding iShares Core Aggregate or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
DHDG vs. iShares Core Aggregate
Performance |
| Timeline |
| DHDG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| iShares Core Aggregate |
DHDG and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DHDG and IShares Core
The main advantage of trading using opposite DHDG and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DHDG position performs unexpectedly, IShares Core 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 Core will offset losses from the drop in IShares Core's long position.| DHDG vs. Vanguard Total Stock | DHDG vs. SPDR SP 500 | DHDG vs. iShares Core SP | DHDG vs. Vanguard Total Bond |
| IShares Core vs. Vanguard Total International | IShares Core vs. Vanguard Total International | IShares Core vs. Vanguard Total Stock | IShares Core vs. Vanguard Real Estate |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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