Correlation Between IShares MSCI and DTRGR

Can any of the company-specific risk be diversified away by investing in both IShares MSCI and DTRGR 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 MSCI and DTRGR into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between iShares MSCI China and DTRGR 35 07 APR 25, you can compare the effects of market volatilities on IShares MSCI and DTRGR 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 MSCI with a short position of DTRGR. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and DTRGR.

Diversification Opportunities for IShares MSCI and DTRGR

-0.4

Correlation Coefficient

IShares MSCI  DTRGR

Very good diversification

The 3 months correlation between IShares and DTRGR is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI China and DTRGR 35 07 APR 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DTRGR 35 07 and IShares MSCI 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 MSCI China are associated (or correlated) with DTRGR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DTRGR 35 07 has no effect on the direction of IShares MSCI i.e., IShares MSCI and DTRGR go up and down completely randomly.

Pair Corralation between IShares MSCI and DTRGR

Given the investment horizon of 90 days iShares MSCI China is expected to generate 77.45 times more return on investment than DTRGR. However, IShares MSCI is 77.45 times more volatile than DTRGR 35 07 APR 25. It trades about 0.07 of its potential returns per unit of risk. DTRGR 35 07 APR 25 is currently generating about 0.3 per unit of risk. If you would invest  4,247  in iShares MSCI China on September 23, 2024 and sell it today you would earn a total of  463.00  from holding iShares MSCI China or generate 10.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	29.23%
Values	Daily Returns

iShares MSCI China  vs.  DTRGR 35 07 APR 25

iShares MSCI China

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in iShares MSCI China are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, IShares MSCI demonstrated solid returns over the last few months and may actually be approaching a breakup point.

DTRGR 35 07

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in DTRGR 35 07 APR 25 are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, DTRGR is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IShares MSCI and DTRGR

The main advantage of trading using opposite IShares MSCI and DTRGR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, DTRGR 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 DTRGR will offset losses from the drop in DTRGR's long position.

The idea behind iShares MSCI China and DTRGR 35 07 APR 25 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..