Correlation Between IShares MSCI and 963320AY2

Can any of the company-specific risk be diversified away by investing in both IShares MSCI and 963320AY2 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 963320AY2 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 WHR 24 15 MAY 31, you can compare the effects of market volatilities on IShares MSCI and 963320AY2 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 963320AY2. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and 963320AY2.

Diversification Opportunities for IShares MSCI and 963320AY2

0.61

Correlation Coefficient

IShares MSCI  963320AY2

Poor diversification

The 3 months correlation between IShares and 963320AY2 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI China and WHR 24 15 MAY 31 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHR 24 15 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 963320AY2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHR 24 15 has no effect on the direction of IShares MSCI i.e., IShares MSCI and 963320AY2 go up and down completely randomly.

Pair Corralation between IShares MSCI and 963320AY2

Given the investment horizon of 90 days iShares MSCI China is expected to generate 2.46 times more return on investment than 963320AY2. However, IShares MSCI is 2.46 times more volatile than WHR 24 15 MAY 31. It trades about 0.06 of its potential returns per unit of risk. WHR 24 15 MAY 31 is currently generating about -0.2 per unit of risk. If you would invest  4,643  in iShares MSCI China on September 29, 2024 and sell it today you would earn a total of  104.00  from holding iShares MSCI China or generate 2.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.0%
Values	Daily Returns

iShares MSCI China  vs.  WHR 24 15 MAY 31

iShares MSCI China

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares MSCI China has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, IShares MSCI is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

WHR 24 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WHR 24 15 MAY 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for WHR 24 15 MAY 31 investors.

Pair Trading with IShares MSCI and 963320AY2

The main advantage of trading using opposite IShares MSCI and 963320AY2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, 963320AY2 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 963320AY2 will offset losses from the drop in 963320AY2's long position.

The idea behind iShares MSCI China and WHR 24 15 MAY 31 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.