Correlation Between IShares Blockchain and First Trust
Can any of the company-specific risk be diversified away by investing in both IShares Blockchain and First Trust 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 Blockchain and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Blockchain and and First Trust SkyBridge, you can compare the effects of market volatilities on IShares Blockchain and First Trust 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 Blockchain with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Blockchain and First Trust.
Diversification Opportunities for IShares Blockchain and First Trust
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and First is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding iShares Blockchain and and First Trust SkyBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust SkyBridge and IShares Blockchain 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 Blockchain and are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust SkyBridge has no effect on the direction of IShares Blockchain i.e., IShares Blockchain and First Trust go up and down completely randomly.
Pair Corralation between IShares Blockchain and First Trust
Given the investment horizon of 90 days iShares Blockchain and is expected to generate 1.08 times more return on investment than First Trust. However, IShares Blockchain is 1.08 times more volatile than First Trust SkyBridge. It trades about 0.01 of its potential returns per unit of risk. First Trust SkyBridge is currently generating about -0.12 per unit of risk. If you would invest 4,404 in iShares Blockchain and on August 26, 2025 and sell it today you would lose (84.00) from holding iShares Blockchain and or give up 1.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Blockchain and vs. First Trust SkyBridge
Performance |
| Timeline |
| iShares Blockchain and |
| First Trust SkyBridge |
IShares Blockchain and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Blockchain and First Trust
The main advantage of trading using opposite IShares Blockchain and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Blockchain position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| IShares Blockchain vs. Strategy Shares | IShares Blockchain vs. Freedom Day Dividend | IShares Blockchain vs. Franklin Templeton ETF | IShares Blockchain vs. iShares MSCI China |
| First Trust vs. Strategy Shares | First Trust vs. Freedom Day Dividend | First Trust vs. Franklin Templeton ETF | First Trust vs. iShares MSCI China |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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