Correlation Between Northern Lights and Innovator ETFs
Can any of the company-specific risk be diversified away by investing in both Northern Lights and Innovator ETFs 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 Northern Lights and Innovator ETFs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Lights and Innovator ETFs Trust, you can compare the effects of market volatilities on Northern Lights and Innovator ETFs 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 Northern Lights with a short position of Innovator ETFs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Lights and Innovator ETFs.
Diversification Opportunities for Northern Lights and Innovator ETFs
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Northern and Innovator is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Northern Lights and Innovator ETFs Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator ETFs Trust and Northern Lights 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 Northern Lights are associated (or correlated) with Innovator ETFs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator ETFs Trust has no effect on the direction of Northern Lights i.e., Northern Lights and Innovator ETFs go up and down completely randomly.
Pair Corralation between Northern Lights and Innovator ETFs
Given the investment horizon of 90 days Northern Lights is expected to generate 1.82 times less return on investment than Innovator ETFs. In addition to that, Northern Lights is 2.98 times more volatile than Innovator ETFs Trust. It trades about 0.02 of its total potential returns per unit of risk. Innovator ETFs Trust is currently generating about 0.13 per unit of volatility. If you would invest 3,555 in Innovator ETFs Trust on September 3, 2025 and sell it today you would earn a total of 70.00 from holding Innovator ETFs Trust or generate 1.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern Lights vs. Innovator ETFs Trust
Performance |
| Timeline |
| Northern Lights |
| Innovator ETFs Trust |
Northern Lights and Innovator ETFs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Lights and Innovator ETFs
The main advantage of trading using opposite Northern Lights and Innovator ETFs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Lights position performs unexpectedly, Innovator ETFs 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 Innovator ETFs will offset losses from the drop in Innovator ETFs' long position.| Northern Lights vs. Vanguard Growth Index | Northern Lights vs. iShares Russell 1000 | Northern Lights vs. SPDR Portfolio SP | Northern Lights vs. Vanguard Mega Cap |
| Innovator ETFs vs. FT Vest Equity | Innovator ETFs vs. Northern Lights | Innovator ETFs vs. Diamond Hill Funds | Innovator ETFs vs. Dimensional International High |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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