Correlation Between Innovator Russell and FT Vest
Can any of the company-specific risk be diversified away by investing in both Innovator Russell and FT Vest 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 Innovator Russell and FT Vest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator Russell 2000 and FT Vest Equity, you can compare the effects of market volatilities on Innovator Russell and FT Vest 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 Innovator Russell with a short position of FT Vest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator Russell and FT Vest.
Diversification Opportunities for Innovator Russell and FT Vest
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Innovator and DHDG is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Innovator Russell 2000 and FT Vest Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Vest Equity and Innovator Russell 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 Innovator Russell 2000 are associated (or correlated) with FT Vest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Vest Equity has no effect on the direction of Innovator Russell i.e., Innovator Russell and FT Vest go up and down completely randomly.
Pair Corralation between Innovator Russell and FT Vest
Given the investment horizon of 90 days Innovator Russell is expected to generate 1.26 times less return on investment than FT Vest. In addition to that, Innovator Russell is 1.28 times more volatile than FT Vest Equity. It trades about 0.12 of its total potential returns per unit of risk. FT Vest Equity is currently generating about 0.19 per unit of volatility. If you would invest 3,246 in FT Vest Equity on September 3, 2025 and sell it today you would earn a total of 135.00 from holding FT Vest Equity or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator Russell 2000 vs. FT Vest Equity
Performance |
| Timeline |
| Innovator Russell 2000 |
| FT Vest Equity |
Innovator Russell and FT Vest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator Russell and FT Vest
The main advantage of trading using opposite Innovator Russell and FT Vest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator Russell position performs unexpectedly, FT Vest 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 FT Vest will offset losses from the drop in FT Vest's long position.| Innovator Russell vs. FT Vest Equity | Innovator Russell vs. Northern Lights | Innovator Russell vs. Diamond Hill Funds | Innovator Russell vs. Dimensional International High |
| FT Vest vs. Northern Lights | FT Vest vs. Diamond Hill Funds | FT Vest vs. Dimensional International High | FT Vest vs. JPMorgan Fundamental Data |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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