Correlation Between IShares SPTSX and XTL Biopharmaceutica
Can any of the company-specific risk be diversified away by investing in both IShares SPTSX and XTL Biopharmaceutica 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 SPTSX and XTL Biopharmaceutica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares SPTSX Capped and XTL Biopharmaceuticals, you can compare the effects of market volatilities on IShares SPTSX and XTL Biopharmaceutica 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 SPTSX with a short position of XTL Biopharmaceutica. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SPTSX and XTL Biopharmaceutica.
Diversification Opportunities for IShares SPTSX and XTL Biopharmaceutica
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IShares and XTL is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding iShares SPTSX Capped and XTL Biopharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTL Biopharmaceuticals and IShares SPTSX 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 SPTSX Capped are associated (or correlated) with XTL Biopharmaceutica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTL Biopharmaceuticals has no effect on the direction of IShares SPTSX i.e., IShares SPTSX and XTL Biopharmaceutica go up and down completely randomly.
Pair Corralation between IShares SPTSX and XTL Biopharmaceutica
Assuming the 90 days trading horizon iShares SPTSX Capped is expected to under-perform the XTL Biopharmaceutica. But the etf apears to be less risky and, when comparing its historical volatility, iShares SPTSX Capped is 25.67 times less risky than XTL Biopharmaceutica. The etf trades about -0.14 of its potential returns per unit of risk. The XTL Biopharmaceuticals is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 340.00 in XTL Biopharmaceuticals on January 24, 2024 and sell it today you would earn a total of 560.00 from holding XTL Biopharmaceuticals or generate 164.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 76.19% |
| Values | Daily Returns |
iShares SPTSX Capped vs. XTL Biopharmaceuticals
Performance |
| Timeline |
| iShares SPTSX Capped |
| XTL Biopharmaceuticals |
IShares SPTSX and XTL Biopharmaceutica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares SPTSX and XTL Biopharmaceutica
The main advantage of trading using opposite IShares SPTSX and XTL Biopharmaceutica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares SPTSX position performs unexpectedly, XTL Biopharmaceutica 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 XTL Biopharmaceutica will offset losses from the drop in XTL Biopharmaceutica's long position.| IShares SPTSX vs. iShares Global Infrastructure | IShares SPTSX vs. iShares Global Monthly | IShares SPTSX vs. iShares 1 5Yr Laddered | IShares SPTSX vs. iShares Equal Weight |
| XTL Biopharmaceutica vs. Nice | XTL Biopharmaceutica vs. Bank Leumi Le Israel | XTL Biopharmaceutica vs. ICL Israel Chemicals | XTL Biopharmaceutica vs. Mizrahi Tefahot |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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