Correlation Between Main Sector and IShares Paris
Can any of the company-specific risk be diversified away by investing in both Main Sector and IShares Paris 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 Main Sector and IShares Paris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Main Sector Rotation and iShares Paris Aligned Climate, you can compare the effects of market volatilities on Main Sector and IShares Paris 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 Main Sector with a short position of IShares Paris. Check out your portfolio center. Please also check ongoing floating volatility patterns of Main Sector and IShares Paris.
Diversification Opportunities for Main Sector and IShares Paris
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Main and IShares is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Main Sector Rotation and iShares Paris Aligned Climate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Paris Aligned and Main Sector 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 Main Sector Rotation are associated (or correlated) with IShares Paris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Paris Aligned has no effect on the direction of Main Sector i.e., Main Sector and IShares Paris go up and down completely randomly.
Pair Corralation between Main Sector and IShares Paris
Given the investment horizon of 90 days Main Sector Rotation is expected to generate 1.02 times more return on investment than IShares Paris. However, Main Sector is 1.02 times more volatile than iShares Paris Aligned Climate. It trades about 0.1 of its potential returns per unit of risk. iShares Paris Aligned Climate is currently generating about 0.08 per unit of risk. If you would invest 6,001 in Main Sector Rotation on August 17, 2025 and sell it today you would earn a total of 298.00 from holding Main Sector Rotation or generate 4.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Main Sector Rotation vs. iShares Paris Aligned Climate
Performance |
| Timeline |
| Main Sector Rotation |
| iShares Paris Aligned |
Main Sector and IShares Paris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Main Sector and IShares Paris
The main advantage of trading using opposite Main Sector and IShares Paris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Main Sector position performs unexpectedly, IShares Paris 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 Paris will offset losses from the drop in IShares Paris' long position.| Main Sector vs. Franklin FTSE India | Main Sector vs. SPDR SP 500 | Main Sector vs. Fidelity MSCI Financials | Main Sector vs. Amplify Junior Silver |
| IShares Paris vs. Amplify Cybersecurity ETF | IShares Paris vs. Amplify Junior Silver | IShares Paris vs. Main Sector Rotation | IShares Paris vs. SPDR SP 400 |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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