Correlation Between Mkeax and Ishares Aggregate
Can any of the company-specific risk be diversified away by investing in both Mkeax and Ishares Aggregate 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 Mkeax and Ishares Aggregate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mkeax and Ishares Aggregate Bond, you can compare the effects of market volatilities on Mkeax and Ishares Aggregate 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 Mkeax with a short position of Ishares Aggregate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mkeax and Ishares Aggregate.
Diversification Opportunities for Mkeax and Ishares Aggregate
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mkeax and Ishares is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mkeax and Ishares Aggregate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ishares Aggregate Bond and Mkeax 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 Mkeax are associated (or correlated) with Ishares Aggregate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ishares Aggregate Bond has no effect on the direction of Mkeax i.e., Mkeax and Ishares Aggregate go up and down completely randomly.
Pair Corralation between Mkeax and Ishares Aggregate
Assuming the 90 days horizon Mkeax is expected to generate 4.59 times more return on investment than Ishares Aggregate. However, Mkeax is 4.59 times more volatile than Ishares Aggregate Bond. It trades about 0.06 of its potential returns per unit of risk. Ishares Aggregate Bond is currently generating about 0.01 per unit of risk. If you would invest 1,548 in Mkeax on September 11, 2025 and sell it today you would earn a total of 48.00 from holding Mkeax or generate 3.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mkeax vs. Ishares Aggregate Bond
Performance |
| Timeline |
| Mkeax |
| Ishares Aggregate Bond |
Mkeax and Ishares Aggregate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mkeax and Ishares Aggregate
The main advantage of trading using opposite Mkeax and Ishares Aggregate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mkeax position performs unexpectedly, Ishares Aggregate 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 Aggregate will offset losses from the drop in Ishares Aggregate's long position.| Mkeax vs. Pace International Equity | Mkeax vs. Nuveen Core Equity | Mkeax vs. Aqr Long Short Equity | Mkeax vs. Morningstar International Equity |
| Ishares Aggregate vs. Vanguard Total Bond | Ishares Aggregate vs. Vanguard Total Bond | Ishares Aggregate vs. Vanguard Total Bond | Ishares Aggregate vs. Vanguard Total Bond |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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