Correlation Between GraniteShares and Xtrackers MSCI
Can any of the company-specific risk be diversified away by investing in both GraniteShares and Xtrackers MSCI 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 GraniteShares and Xtrackers MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 3x Short and Xtrackers MSCI, you can compare the effects of market volatilities on GraniteShares and Xtrackers MSCI 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 GraniteShares with a short position of Xtrackers MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and Xtrackers MSCI.
Diversification Opportunities for GraniteShares and Xtrackers MSCI
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between GraniteShares and Xtrackers is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 3x Short and Xtrackers MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers MSCI and GraniteShares 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 GraniteShares 3x Short are associated (or correlated) with Xtrackers MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers MSCI has no effect on the direction of GraniteShares i.e., GraniteShares and Xtrackers MSCI go up and down completely randomly.
Pair Corralation between GraniteShares and Xtrackers MSCI
Assuming the 90 days trading horizon GraniteShares 3x Short is expected to under-perform the Xtrackers MSCI. In addition to that, GraniteShares is 2.88 times more volatile than Xtrackers MSCI. It trades about -0.11 of its total potential returns per unit of risk. Xtrackers MSCI is currently generating about -0.15 per unit of volatility. If you would invest 4,904 in Xtrackers MSCI on September 3, 2024 and sell it today you would lose (177.00) from holding Xtrackers MSCI or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares 3x Short vs. Xtrackers MSCI
Performance |
| Timeline |
| GraniteShares 3x Short |
| Xtrackers MSCI |
GraniteShares and Xtrackers MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares and Xtrackers MSCI
The main advantage of trading using opposite GraniteShares and Xtrackers MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares position performs unexpectedly, Xtrackers MSCI 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 Xtrackers MSCI will offset losses from the drop in Xtrackers MSCI's long position.| GraniteShares vs. GraniteShares 3x Short | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 1x Short |
| Xtrackers MSCI vs. WisdomTree Natural Gas | Xtrackers MSCI vs. WisdomTree Natural Gas | Xtrackers MSCI vs. Leverage Shares 2x | Xtrackers MSCI vs. WisdomTree Silver 3x |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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