Correlation Between Listed Funds and IShares MSCI
Can any of the company-specific risk be diversified away by investing in both Listed Funds and IShares 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 Listed Funds and IShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Listed Funds Trust and iShares MSCI ACWI, you can compare the effects of market volatilities on Listed Funds and IShares 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 Listed Funds with a short position of IShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Listed Funds and IShares MSCI.
Diversification Opportunities for Listed Funds and IShares MSCI
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Listed and IShares is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Listed Funds Trust and iShares MSCI ACWI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares MSCI ACWI and Listed Funds 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 Listed Funds Trust are associated (or correlated) with IShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares MSCI ACWI has no effect on the direction of Listed Funds i.e., Listed Funds and IShares MSCI go up and down completely randomly.
Pair Corralation between Listed Funds and IShares MSCI
Given the investment horizon of 90 days Listed Funds Trust is expected to generate 0.8 times more return on investment than IShares MSCI. However, Listed Funds Trust is 1.25 times less risky than IShares MSCI. It trades about 0.17 of its potential returns per unit of risk. iShares MSCI ACWI is currently generating about 0.09 per unit of risk. If you would invest 2,992 in Listed Funds Trust on September 3, 2024 and sell it today you would earn a total of 426.00 from holding Listed Funds Trust or generate 14.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Listed Funds Trust vs. iShares MSCI ACWI
Performance |
| Timeline |
| Listed Funds Trust |
| iShares MSCI ACWI |
Listed Funds and IShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Listed Funds and IShares MSCI
The main advantage of trading using opposite Listed Funds and IShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Listed Funds position performs unexpectedly, IShares 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 IShares MSCI will offset losses from the drop in IShares MSCI's long position.| Listed Funds vs. Global X Funds | Listed Funds vs. Dell Technologies | Listed Funds vs. Juniper Networks | Listed Funds vs. HUMANA INC |
| IShares MSCI vs. SmartETFs Asia Pacific | IShares MSCI vs. Listed Funds Trust | IShares MSCI vs. iShares AsiaPacific Dividend | IShares MSCI vs. ProShares MSCI Emerging |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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