Correlation Between IShares Core and Alps/kotak India

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Can any of the company-specific risk be diversified away by investing in both IShares Core and Alps/kotak India 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 Core and Alps/kotak India into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core SP and Alpskotak India Growth, you can compare the effects of market volatilities on IShares Core and Alps/kotak India 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 Core with a short position of Alps/kotak India. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Alps/kotak India.

Diversification Opportunities for IShares Core and Alps/kotak India

0.05
  Correlation Coefficient

Significant diversification

The 3 months correlation between IShares and Alps/kotak is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and Alpskotak India Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpskotak India Growth and IShares Core 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 Core SP are associated (or correlated) with Alps/kotak India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpskotak India Growth has no effect on the direction of IShares Core i.e., IShares Core and Alps/kotak India go up and down completely randomly.

Pair Corralation between IShares Core and Alps/kotak India

Considering the 90-day investment horizon iShares Core SP is expected to generate 1.15 times more return on investment than Alps/kotak India. However, IShares Core is 1.15 times more volatile than Alpskotak India Growth. It trades about 0.1 of its potential returns per unit of risk. Alpskotak India Growth is currently generating about -0.02 per unit of risk. If you would invest  64,102  in iShares Core SP on August 19, 2025 and sell it today you would earn a total of  2,797  from holding iShares Core SP or generate 4.36% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

iShares Core SP  vs.  Alpskotak India Growth

 Performance 
       Timeline  
iShares Core SP 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in iShares Core SP are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, IShares Core is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
Alpskotak India Growth 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Alpskotak India Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Alps/kotak India is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

IShares Core and Alps/kotak India Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares Core and Alps/kotak India

The main advantage of trading using opposite IShares Core and Alps/kotak India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Alps/kotak India 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 Alps/kotak India will offset losses from the drop in Alps/kotak India's long position.
The idea behind iShares Core SP and Alpskotak India Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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