Correlation Between Morgan Stanley and FlatexDEGIRO
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and FlatexDEGIRO 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 Morgan Stanley and FlatexDEGIRO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley and flatexDEGIRO AG, you can compare the effects of market volatilities on Morgan Stanley and FlatexDEGIRO 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 Morgan Stanley with a short position of FlatexDEGIRO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and FlatexDEGIRO.
Diversification Opportunities for Morgan Stanley and FlatexDEGIRO
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Morgan and FlatexDEGIRO is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley and flatexDEGIRO AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on flatexDEGIRO AG and Morgan Stanley 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 Morgan Stanley are associated (or correlated) with FlatexDEGIRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of flatexDEGIRO AG has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and FlatexDEGIRO go up and down completely randomly.
Pair Corralation between Morgan Stanley and FlatexDEGIRO
Assuming the 90 days horizon Morgan Stanley is expected to generate 1.64 times less return on investment than FlatexDEGIRO. But when comparing it to its historical volatility, Morgan Stanley is 1.38 times less risky than FlatexDEGIRO. It trades about 0.06 of its potential returns per unit of risk. flatexDEGIRO AG is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 698.00 in flatexDEGIRO AG on September 25, 2024 and sell it today you would earn a total of 774.00 from holding flatexDEGIRO AG or generate 110.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Morgan Stanley vs. flatexDEGIRO AG
Performance |
| Timeline |
| Morgan Stanley |
| flatexDEGIRO AG |
Morgan Stanley and FlatexDEGIRO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and FlatexDEGIRO
The main advantage of trading using opposite Morgan Stanley and FlatexDEGIRO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, FlatexDEGIRO 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 FlatexDEGIRO will offset losses from the drop in FlatexDEGIRO's long position.| Morgan Stanley vs. Morgan Stanley | Morgan Stanley vs. The Charles Schwab | Morgan Stanley vs. The Goldman Sachs | Morgan Stanley vs. SP Global |
| FlatexDEGIRO vs. Morgan Stanley | FlatexDEGIRO vs. Morgan Stanley | FlatexDEGIRO vs. The Charles Schwab | FlatexDEGIRO vs. The Goldman Sachs |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |