Correlation Between Dun Bradstreet and MSCI

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Can any of the company-specific risk be diversified away by investing in both Dun Bradstreet and 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 Dun Bradstreet and MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dun Bradstreet Holdings and MSCI Inc, you can compare the effects of market volatilities on Dun Bradstreet and 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 Dun Bradstreet with a short position of MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dun Bradstreet and MSCI.

Diversification Opportunities for Dun Bradstreet and MSCI

DunMSCIDiversified AwayDunMSCIDiversified Away100%
0.53
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Dun and MSCI is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dun Bradstreet Holdings and MSCI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MSCI Inc and Dun Bradstreet 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 Dun Bradstreet Holdings are associated (or correlated) with MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MSCI Inc has no effect on the direction of Dun Bradstreet i.e., Dun Bradstreet and MSCI go up and down completely randomly.

Pair Corralation between Dun Bradstreet and MSCI

Considering the 90-day investment horizon Dun Bradstreet Holdings is expected to under-perform the MSCI. In addition to that, Dun Bradstreet is 1.95 times more volatile than MSCI Inc. It trades about -0.39 of its total potential returns per unit of risk. MSCI Inc is currently generating about -0.23 per unit of volatility. If you would invest  62,636  in MSCI Inc on November 29, 2024 and sell it today you would lose (4,692) from holding MSCI Inc or give up 7.49% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy95.45%
ValuesDaily Returns

Dun Bradstreet Holdings  vs.  MSCI Inc

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -10-505
JavaScript chart by amCharts 3.21.15DNB MSCI
       Timeline  
Dun Bradstreet Holdings 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Dun Bradstreet Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb99.51010.51111.51212.5
MSCI Inc 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days MSCI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, MSCI is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb560570580590600610620630640

Dun Bradstreet and MSCI Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.6-2.7-1.79-0.890.00.741.492.232.98 0.050.100.150.20
JavaScript chart by amCharts 3.21.15DNB MSCI
       Returns  

Pair Trading with Dun Bradstreet and MSCI

The main advantage of trading using opposite Dun Bradstreet and MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dun Bradstreet position performs unexpectedly, 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 MSCI will offset losses from the drop in MSCI's long position.
The idea behind Dun Bradstreet Holdings and MSCI Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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