Correlation Between Aberdeen New and HSBC MSCI
Can any of the company-specific risk be diversified away by investing in both Aberdeen New and HSBC 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 Aberdeen New and HSBC MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen New India and HSBC MSCI USA, you can compare the effects of market volatilities on Aberdeen New and HSBC 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 Aberdeen New with a short position of HSBC MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen New and HSBC MSCI.
Diversification Opportunities for Aberdeen New and HSBC MSCI
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aberdeen and HSBC is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen New India and HSBC MSCI USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC MSCI USA and Aberdeen New 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 Aberdeen New India are associated (or correlated) with HSBC MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSBC MSCI USA has no effect on the direction of Aberdeen New i.e., Aberdeen New and HSBC MSCI go up and down completely randomly.
Pair Corralation between Aberdeen New and HSBC MSCI
Assuming the 90 days trading horizon Aberdeen New India is expected to generate 0.9 times more return on investment than HSBC MSCI. However, Aberdeen New India is 1.11 times less risky than HSBC MSCI. It trades about 0.36 of its potential returns per unit of risk. HSBC MSCI USA is currently generating about 0.21 per unit of risk. If you would invest 74,800 in Aberdeen New India on August 30, 2024 and sell it today you would earn a total of 6,400 from holding Aberdeen New India or generate 8.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen New India vs. HSBC MSCI USA
Performance |
| Timeline |
| Aberdeen New India |
| HSBC MSCI USA |
Aberdeen New and HSBC MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen New and HSBC MSCI
The main advantage of trading using opposite Aberdeen New and HSBC MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen New position performs unexpectedly, HSBC 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 HSBC MSCI will offset losses from the drop in HSBC MSCI's long position.| Aberdeen New vs. Downing Strategic Micro Cap | Aberdeen New vs. CT Private Equity | Aberdeen New vs. Baillie Gifford Growth | Aberdeen New vs. Blackrock Energy and |
| HSBC MSCI vs. HSBC FTSE EPRA | HSBC MSCI vs. HSBC SP 500 | HSBC MSCI vs. HSBC MSCI Emerging | HSBC MSCI vs. HSBC NASDAQ Global |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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