Correlation Between Cboe UK and HSBC MSCI
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By analyzing existing cross correlation between Cboe UK Consumer and HSBC MSCI USA, you can compare the effects of market volatilities on Cboe UK 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 Cboe UK with a short position of HSBC MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cboe UK and HSBC MSCI.
Diversification Opportunities for Cboe UK and HSBC MSCI
Poor diversification
The 3 months correlation between Cboe and HSBC is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cboe UK Consumer 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 Cboe UK 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 Cboe UK Consumer 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 Cboe UK i.e., Cboe UK and HSBC MSCI go up and down completely randomly.
Pair Corralation between Cboe UK and HSBC MSCI
Assuming the 90 days trading horizon Cboe UK is expected to generate 1.16 times less return on investment than HSBC MSCI. But when comparing it to its historical volatility, Cboe UK Consumer is 2.35 times less risky than HSBC MSCI. It trades about 0.07 of its potential returns per unit of risk. HSBC MSCI USA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,067 in HSBC MSCI USA on September 2, 2024 and sell it today you would earn a total of 452.00 from holding HSBC MSCI USA or generate 21.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.95% |
| Values | Daily Returns |
Cboe UK Consumer vs. HSBC MSCI USA
Performance |
| Timeline |
Cboe UK and HSBC MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Cboe UK Consumer
Pair trading matchups for Cboe UK
HSBC MSCI USA
Pair trading matchups for HSBC MSCI
Pair Trading with Cboe UK and HSBC MSCI
The main advantage of trading using opposite Cboe UK and HSBC MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cboe UK 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.| Cboe UK vs. Check Point Software | Cboe UK vs. Evolution Gaming Group | Cboe UK vs. Beeks Trading | Cboe UK vs. Hansa Investment |
| 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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