Correlation Between EMQQ Emerging and IShares MSCI
Can any of the company-specific risk be diversified away by investing in both EMQQ Emerging and IShares 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 EMQQ Emerging and IShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMQQ The Emerging and iShares MSCI China, you can compare the effects of market volatilities on EMQQ Emerging and IShares 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 EMQQ Emerging with a short position of IShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMQQ Emerging and IShares MSCI.
Diversification Opportunities for EMQQ Emerging and IShares MSCI
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EMQQ and IShares is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding EMQQ The Emerging and iShares MSCI China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares MSCI China and EMQQ 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 EMQQ The Emerging are associated (or correlated) with IShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares MSCI China has no effect on the direction of EMQQ Emerging i.e., EMQQ Emerging and IShares MSCI go up and down completely randomly.
Pair Corralation between EMQQ Emerging and IShares MSCI
Given the investment horizon of 90 days EMQQ The Emerging is expected to generate 0.82 times more return on investment than IShares MSCI. However, EMQQ The Emerging is 1.22 times less risky than IShares MSCI. It trades about 0.04 of its potential returns per unit of risk. iShares MSCI China is currently generating about 0.02 per unit of risk. If you would invest 3,025 in EMQQ The Emerging on November 27, 2024 and sell it today you would earn a total of 818.00 from holding EMQQ The Emerging or generate 27.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EMQQ The Emerging vs. iShares MSCI China
Performance |
| Timeline |
| EMQQ The Emerging |
| iShares MSCI China |
EMQQ Emerging and IShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMQQ Emerging and IShares MSCI
The main advantage of trading using opposite EMQQ Emerging and IShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMQQ Emerging position performs unexpectedly, IShares 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 IShares MSCI will offset losses from the drop in IShares MSCI's long position.| EMQQ Emerging vs. Invesco China Technology | EMQQ Emerging vs. Amplify Online Retail | EMQQ Emerging vs. KraneShares CSI China | EMQQ Emerging vs. Global X MSCI |
| IShares MSCI vs. KraneShares CSI China | IShares MSCI vs. Invesco China Technology | IShares MSCI vs. iShares MSCI India | IShares MSCI vs. Xtrackers Harvest CSI |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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