Correlation Between IShares Utilities and IShares Core
Can any of the company-specific risk be diversified away by investing in both IShares Utilities 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 IShares Utilities and IShares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Utilities ETF and iShares Core Moderate, you can compare the effects of market volatilities on IShares Utilities 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 IShares Utilities with a short position of IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Utilities and IShares Core.
Diversification Opportunities for IShares Utilities and IShares Core
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and IShares is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding iShares Utilities ETF and iShares Core Moderate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Moderate and IShares Utilities 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 Utilities ETF 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 Moderate has no effect on the direction of IShares Utilities i.e., IShares Utilities and IShares Core go up and down completely randomly.
Pair Corralation between IShares Utilities and IShares Core
Considering the 90-day investment horizon IShares Utilities is expected to generate 1.07 times less return on investment than IShares Core. In addition to that, IShares Utilities is 2.02 times more volatile than iShares Core Moderate. It trades about 0.08 of its total potential returns per unit of risk. iShares Core Moderate is currently generating about 0.18 per unit of volatility. If you would invest 4,623 in iShares Core Moderate on August 14, 2025 and sell it today you would earn a total of 186.00 from holding iShares Core Moderate or generate 4.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
iShares Utilities ETF vs. iShares Core Moderate
Performance |
| Timeline |
| iShares Utilities ETF |
| iShares Core Moderate |
IShares Utilities and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Utilities and IShares Core
The main advantage of trading using opposite IShares Utilities and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Utilities 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.| IShares Utilities vs. Utilities Select Sector | IShares Utilities vs. Vanguard Utilities Index | IShares Utilities vs. Fidelity MSCI Utilities | IShares Utilities vs. First Trust Utilities |
| IShares Core vs. iShares Utilities ETF | IShares Core vs. iShares Broker Dealers Securities | IShares Core vs. Invesco SP International | IShares Core vs. iShares MSCI Australia |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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