Correlation Between Dynamic Active and IShares Small
Can any of the company-specific risk be diversified away by investing in both Dynamic Active and IShares Small 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 Dynamic Active and IShares Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynamic Active Mining and iShares Small Cap, you can compare the effects of market volatilities on Dynamic Active and IShares Small 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 Dynamic Active with a short position of IShares Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynamic Active and IShares Small.
Diversification Opportunities for Dynamic Active and IShares Small
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dynamic and IShares is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Dynamic Active Mining and iShares Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Small Cap and Dynamic Active 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 Dynamic Active Mining are associated (or correlated) with IShares Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Small Cap has no effect on the direction of Dynamic Active i.e., Dynamic Active and IShares Small go up and down completely randomly.
Pair Corralation between Dynamic Active and IShares Small
Assuming the 90 days trading horizon Dynamic Active Mining is expected to generate 1.7 times more return on investment than IShares Small. However, Dynamic Active is 1.7 times more volatile than iShares Small Cap. It trades about 0.09 of its potential returns per unit of risk. iShares Small Cap is currently generating about 0.01 per unit of risk. If you would invest 2,660 in Dynamic Active Mining on August 26, 2025 and sell it today you would earn a total of 290.00 from holding Dynamic Active Mining or generate 10.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynamic Active Mining vs. iShares Small Cap
Performance |
| Timeline |
| Dynamic Active Mining |
| iShares Small Cap |
Dynamic Active and IShares Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynamic Active and IShares Small
The main advantage of trading using opposite Dynamic Active and IShares Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynamic Active position performs unexpectedly, IShares Small 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 Small will offset losses from the drop in IShares Small's long position.| Dynamic Active vs. BetaPro SPTSX Capped | Dynamic Active vs. BetaPro SP 500 | Dynamic Active vs. Desjardins RI Canada | Dynamic Active vs. Harvest Equal Weight |
| IShares Small vs. Vanguard FTSE Developed | IShares Small vs. Vanguard Conservative ETF | IShares Small vs. Vanguard FTSE Developed | IShares Small vs. iShares MSCI Europe |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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