Correlation Between IShares MSCI and Janus Henderson
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and Janus Henderson 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 IShares MSCI and Janus Henderson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI EAFE and Janus Henderson, you can compare the effects of market volatilities on IShares MSCI and Janus Henderson 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 IShares MSCI with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and Janus Henderson.
Diversification Opportunities for IShares MSCI and Janus Henderson
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Janus is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI EAFE and Janus Henderson in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson and IShares 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 iShares MSCI EAFE are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson has no effect on the direction of IShares MSCI i.e., IShares MSCI and Janus Henderson go up and down completely randomly.
Pair Corralation between IShares MSCI and Janus Henderson
Considering the 90-day investment horizon iShares MSCI EAFE is expected to under-perform the Janus Henderson. But the etf apears to be less risky and, when comparing its historical volatility, iShares MSCI EAFE is 1.15 times less risky than Janus Henderson. The etf trades about -0.03 of its potential returns per unit of risk. The Janus Henderson is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,816 in Janus Henderson on August 24, 2024 and sell it today you would earn a total of 133.00 from holding Janus Henderson or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 77.6% |
| Values | Daily Returns |
iShares MSCI EAFE vs. Janus Henderson
Performance |
| Timeline |
| iShares MSCI EAFE |
| Janus Henderson |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
IShares MSCI and Janus Henderson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and Janus Henderson
The main advantage of trading using opposite IShares MSCI and Janus Henderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, Janus Henderson 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 Janus Henderson will offset losses from the drop in Janus Henderson's long position.| IShares MSCI vs. iShares MSCI EAFE | IShares MSCI vs. iShares MSCI EAFE | IShares MSCI vs. iShares Russell Mid Cap | IShares MSCI vs. iShares MSCI Netherlands |
| Janus Henderson vs. Invesco DWA Emerging | Janus Henderson vs. Invesco DWA Momentum | Janus Henderson vs. Invesco DWA SmallCap | Janus Henderson vs. Invesco FTSE RAFI |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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