Correlation Between Amundi CAC and HSBC MSCI
Can any of the company-specific risk be diversified away by investing in both Amundi CAC 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 Amundi CAC and HSBC MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi CAC 40 and HSBC MSCI Japan, you can compare the effects of market volatilities on Amundi CAC 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 Amundi CAC with a short position of HSBC MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi CAC and HSBC MSCI.
Diversification Opportunities for Amundi CAC and HSBC MSCI
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Amundi and HSBC is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Amundi CAC 40 and HSBC MSCI Japan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC MSCI Japan and Amundi CAC 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 Amundi CAC 40 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 Japan has no effect on the direction of Amundi CAC i.e., Amundi CAC and HSBC MSCI go up and down completely randomly.
Pair Corralation between Amundi CAC and HSBC MSCI
Assuming the 90 days trading horizon Amundi CAC is expected to generate 1.58 times less return on investment than HSBC MSCI. But when comparing it to its historical volatility, Amundi CAC 40 is 1.17 times less risky than HSBC MSCI. It trades about 0.05 of its potential returns per unit of risk. HSBC MSCI Japan is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,893 in HSBC MSCI Japan on September 12, 2024 and sell it today you would earn a total of 980.00 from holding HSBC MSCI Japan or generate 33.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Amundi CAC 40 vs. HSBC MSCI Japan
Performance |
| Timeline |
| Amundi CAC 40 |
| HSBC MSCI Japan |
Amundi CAC and HSBC MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi CAC and HSBC MSCI
The main advantage of trading using opposite Amundi CAC and HSBC MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi CAC 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.| Amundi CAC vs. Deutsche Telekom AG | Amundi CAC vs. Volkswagen AG | Amundi CAC vs. Bayerische Motoren Werke | Amundi CAC vs. Mnchener Rck AG |
| HSBC MSCI vs. Lyxor UCITS Japan | HSBC MSCI vs. Lyxor UCITS Japan | HSBC MSCI vs. Lyxor UCITS Stoxx | HSBC MSCI vs. Amundi CAC 40 |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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