Correlation Between Ashmore Emerging and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Morgan Stanley 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 Ashmore Emerging and Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Morgan Stanley Multi, you can compare the effects of market volatilities on Ashmore Emerging and Morgan Stanley 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 Ashmore Emerging with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Morgan Stanley.
Diversification Opportunities for Ashmore Emerging and Morgan Stanley
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ashmore and Morgan is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Morgan Stanley Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley Multi and Ashmore Emerging 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 Ashmore Emerging Markets are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley Multi has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Morgan Stanley go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Morgan Stanley
Assuming the 90 days horizon Ashmore Emerging is expected to generate 45.75 times less return on investment than Morgan Stanley. But when comparing it to its historical volatility, Ashmore Emerging Markets is 8.49 times less risky than Morgan Stanley. It trades about 0.09 of its potential returns per unit of risk. Morgan Stanley Multi is currently generating about 0.5 of returns per unit of risk over similar time horizon. If you would invest 3,640 in Morgan Stanley Multi on September 19, 2024 and sell it today you would earn a total of 621.00 from holding Morgan Stanley Multi or generate 17.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Morgan Stanley Multi
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Morgan Stanley Multi |
Ashmore Emerging and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Morgan Stanley
The main advantage of trading using opposite Ashmore Emerging and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets | Ashmore Emerging vs. Ashmore Emerging Markets |
| Morgan Stanley vs. Franklin Emerging Market | Morgan Stanley vs. Ashmore Emerging Markets | Morgan Stanley vs. Artisan Emerging Markets | Morgan Stanley vs. Dws Emerging Markets |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |