Correlation Between IShares Flexible and IShares Canadian
Can any of the company-specific risk be diversified away by investing in both IShares Flexible and IShares Canadian 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 Flexible and IShares Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Flexible Monthly and iShares Canadian HYBrid, you can compare the effects of market volatilities on IShares Flexible and IShares Canadian 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 Flexible with a short position of IShares Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Flexible and IShares Canadian.
Diversification Opportunities for IShares Flexible and IShares Canadian
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and IShares is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding iShares Flexible Monthly and iShares Canadian HYBrid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Canadian HYBrid and IShares Flexible 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 Flexible Monthly are associated (or correlated) with IShares Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Canadian HYBrid has no effect on the direction of IShares Flexible i.e., IShares Flexible and IShares Canadian go up and down completely randomly.
Pair Corralation between IShares Flexible and IShares Canadian
Assuming the 90 days trading horizon IShares Flexible is expected to generate 2.54 times less return on investment than IShares Canadian. But when comparing it to its historical volatility, iShares Flexible Monthly is 1.22 times less risky than IShares Canadian. It trades about 0.03 of its potential returns per unit of risk. iShares Canadian HYBrid is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,979 in iShares Canadian HYBrid on September 9, 2025 and sell it today you would earn a total of 13.00 from holding iShares Canadian HYBrid or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.46% |
| Values | Daily Returns |
iShares Flexible Monthly vs. iShares Canadian HYBrid
Performance |
| Timeline |
| iShares Flexible Monthly |
| iShares Canadian HYBrid |
IShares Flexible and IShares Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Flexible and IShares Canadian
The main advantage of trading using opposite IShares Flexible and IShares Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Flexible position performs unexpectedly, IShares Canadian 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 Canadian will offset losses from the drop in IShares Canadian's long position.| IShares Flexible vs. iShares Convertible Bond | IShares Flexible vs. iShares SP Mid Cap | IShares Flexible vs. iShares Edge MSCI | IShares Flexible vs. iShares Core Canadian |
| IShares Canadian vs. CI Enhanced Short | IShares Canadian vs. Fidelity High Dividend | IShares Canadian vs. iShares ESG Aware | IShares Canadian vs. RBC Quant Dividend |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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