| FDLS Etf | | | USD 34.13 0.11 0.32% |
The current 90-days correlation between Northern Lights and iShares Small Cap is 0.86 (i.e., Very poor diversification). The correlation of Northern Lights is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.
Northern Lights Correlation With Market
Very poor diversification
The correlation between Northern Lights and DJI is 0.89 (i.e., Very poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Northern Lights and DJI in the same portfolio, assuming nothing else is changed.
Check out
Investing Opportunities to better understand how to build diversified portfolios, which includes a position in Northern Lights. Also, note that the market value of any etf could be closely tied with the direction of predictive economic indicators such as
signals in bureau of economic analysis.
For more information on how to buy Northern Etf please use our
How to Invest in Northern Lights guide.