Correlation Between Amundi MSCI and Amundi German
Can any of the company-specific risk be diversified away by investing in both Amundi MSCI and Amundi German 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 MSCI and Amundi German into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi MSCI Europe and Amundi German Bund, you can compare the effects of market volatilities on Amundi MSCI and Amundi German 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 MSCI with a short position of Amundi German. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi MSCI and Amundi German.
Diversification Opportunities for Amundi MSCI and Amundi German
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Amundi and Amundi is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Amundi MSCI Europe and Amundi German Bund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi German Bund and Amundi MSCI 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 MSCI Europe are associated (or correlated) with Amundi German. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi German Bund has no effect on the direction of Amundi MSCI i.e., Amundi MSCI and Amundi German go up and down completely randomly.
Pair Corralation between Amundi MSCI and Amundi German
Assuming the 90 days trading horizon Amundi MSCI Europe is expected to generate 0.94 times more return on investment than Amundi German. However, Amundi MSCI Europe is 1.07 times less risky than Amundi German. It trades about 0.28 of its potential returns per unit of risk. Amundi German Bund is currently generating about 0.24 per unit of risk. If you would invest 18,234 in Amundi MSCI Europe on October 25, 2024 and sell it today you would earn a total of 546.00 from holding Amundi MSCI Europe or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi MSCI Europe vs. Amundi German Bund
Performance |
| Timeline |
| Amundi MSCI Europe |
| Amundi German Bund |
Amundi MSCI and Amundi German Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi MSCI and Amundi German
The main advantage of trading using opposite Amundi MSCI and Amundi German positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi MSCI position performs unexpectedly, Amundi German 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 Amundi German will offset losses from the drop in Amundi German's long position.| Amundi MSCI vs. Amundi ETF MSCI | Amundi MSCI vs. Lyxor UCITS Stoxx | Amundi MSCI vs. Amundi Index Solutions | Amundi MSCI vs. Amundi MSCI Europe |
| Amundi German vs. Lyxor UCITS CAC | Amundi German vs. Lyxor UCITS Stoxx | Amundi German vs. Lyxor UCITS Daily | Amundi German vs. Lyxor SP 500 |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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