Correlation Between Macquarie Focused and Xtrackers MSCI
Can any of the company-specific risk be diversified away by investing in both Macquarie Focused and Xtrackers 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 Macquarie Focused and Xtrackers MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Focused Emerging and Xtrackers MSCI Emerging, you can compare the effects of market volatilities on Macquarie Focused and Xtrackers 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 Macquarie Focused with a short position of Xtrackers MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Focused and Xtrackers MSCI.
Diversification Opportunities for Macquarie Focused and Xtrackers MSCI
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Macquarie and Xtrackers is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Focused Emerging and Xtrackers MSCI Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers MSCI Emerging and Macquarie Focused 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 Macquarie Focused Emerging are associated (or correlated) with Xtrackers MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers MSCI Emerging has no effect on the direction of Macquarie Focused i.e., Macquarie Focused and Xtrackers MSCI go up and down completely randomly.
Pair Corralation between Macquarie Focused and Xtrackers MSCI
Given the investment horizon of 90 days Macquarie Focused Emerging is expected to under-perform the Xtrackers MSCI. In addition to that, Macquarie Focused is 1.48 times more volatile than Xtrackers MSCI Emerging. It trades about -0.17 of its total potential returns per unit of risk. Xtrackers MSCI Emerging is currently generating about -0.13 per unit of volatility. If you would invest 2,596 in Xtrackers MSCI Emerging on September 2, 2024 and sell it today you would lose (58.00) from holding Xtrackers MSCI Emerging or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Focused Emerging vs. Xtrackers MSCI Emerging
Performance |
| Timeline |
| Macquarie Focused |
| Xtrackers MSCI Emerging |
Macquarie Focused and Xtrackers MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Focused and Xtrackers MSCI
The main advantage of trading using opposite Macquarie Focused and Xtrackers MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Focused position performs unexpectedly, Xtrackers 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 Xtrackers MSCI will offset losses from the drop in Xtrackers MSCI's long position.| Macquarie Focused vs. Direxion Daily MSCI | Macquarie Focused vs. Innovator MSCI Emerging | Macquarie Focused vs. Innovator ETFs Trust | Macquarie Focused vs. Innovator MSCI Emerging |
| Xtrackers MSCI vs. Xtrackers MSCI EAFE | Xtrackers MSCI vs. Xtrackers MSCI All | Xtrackers MSCI vs. Xtrackers MSCI Japan | Xtrackers MSCI vs. iShares Currency Hedged |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |