Correlation Between IShares MSCI and CHII
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and CHII 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 CHII into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI Malaysia and CHII, you can compare the effects of market volatilities on IShares MSCI and CHII 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 CHII. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and CHII.
Diversification Opportunities for IShares MSCI and CHII
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IShares and CHII is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI Malaysia and CHII in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHII 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 Malaysia are associated (or correlated) with CHII. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHII has no effect on the direction of IShares MSCI i.e., IShares MSCI and CHII go up and down completely randomly.
Pair Corralation between IShares MSCI and CHII
If you would invest 1,224 in CHII on August 27, 2024 and sell it today you would earn a total of 0.00 from holding CHII or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
iShares MSCI Malaysia vs. CHII
Performance |
| Timeline |
| iShares MSCI Malaysia |
| CHII |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IShares MSCI and CHII Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and CHII
The main advantage of trading using opposite IShares MSCI and CHII positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, CHII 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 CHII will offset losses from the drop in CHII's long position.| IShares MSCI vs. iShares MSCI Singapore | IShares MSCI vs. iShares MSCI Taiwan | IShares MSCI vs. iShares MSCI Australia | IShares MSCI vs. iShares MSCI Hong |
| CHII vs. iShares MSCI Singapore | CHII vs. iShares MSCI Malaysia | CHII vs. iShares MSCI Australia | CHII vs. iShares MSCI South |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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