Correlation Between Baloise Holding and Xtrackers MSCI
Can any of the company-specific risk be diversified away by investing in both Baloise Holding 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 Baloise Holding and Xtrackers MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baloise Holding AG and Xtrackers MSCI World, you can compare the effects of market volatilities on Baloise Holding 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 Baloise Holding with a short position of Xtrackers MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and Xtrackers MSCI.
Diversification Opportunities for Baloise Holding and Xtrackers MSCI
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baloise and Xtrackers is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and Xtrackers MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers MSCI World and Baloise Holding 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 Baloise Holding AG 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 World has no effect on the direction of Baloise Holding i.e., Baloise Holding and Xtrackers MSCI go up and down completely randomly.
Pair Corralation between Baloise Holding and Xtrackers MSCI
Assuming the 90 days trading horizon Baloise Holding is expected to generate 1.15 times less return on investment than Xtrackers MSCI. In addition to that, Baloise Holding is 1.11 times more volatile than Xtrackers MSCI World. It trades about 0.08 of its total potential returns per unit of risk. Xtrackers MSCI World is currently generating about 0.11 per unit of volatility. If you would invest 6,688 in Xtrackers MSCI World on September 12, 2024 and sell it today you would earn a total of 2,362 from holding Xtrackers MSCI World or generate 35.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baloise Holding AG vs. Xtrackers MSCI World
Performance |
| Timeline |
| Baloise Holding AG |
| Xtrackers MSCI World |
Baloise Holding and Xtrackers MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and Xtrackers MSCI
The main advantage of trading using opposite Baloise Holding and Xtrackers MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding 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.| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
| Xtrackers MSCI vs. Baloise Holding AG | Xtrackers MSCI vs. 21Shares Polkadot ETP | Xtrackers MSCI vs. UBS ETF MSCI | Xtrackers MSCI vs. BB Biotech AG |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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