Correlation Between IShares MSCI and Breakwave Dry
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and Breakwave Dry 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 Breakwave Dry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI France and Breakwave Dry Bulk, you can compare the effects of market volatilities on IShares MSCI and Breakwave Dry 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 Breakwave Dry. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and Breakwave Dry.
Diversification Opportunities for IShares MSCI and Breakwave Dry
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Breakwave is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI France and Breakwave Dry Bulk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Breakwave Dry Bulk 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 France are associated (or correlated) with Breakwave Dry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Breakwave Dry Bulk has no effect on the direction of IShares MSCI i.e., IShares MSCI and Breakwave Dry go up and down completely randomly.
Pair Corralation between IShares MSCI and Breakwave Dry
Considering the 90-day investment horizon IShares MSCI is expected to generate 12.62 times less return on investment than Breakwave Dry. But when comparing it to its historical volatility, iShares MSCI France is 3.93 times less risky than Breakwave Dry. It trades about 0.06 of its potential returns per unit of risk. Breakwave Dry Bulk is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 532.00 in Breakwave Dry Bulk on November 27, 2024 and sell it today you would earn a total of 77.00 from holding Breakwave Dry Bulk or generate 14.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares MSCI France vs. Breakwave Dry Bulk
Performance |
| Timeline |
| iShares MSCI France |
| Breakwave Dry Bulk |
IShares MSCI and Breakwave Dry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and Breakwave Dry
The main advantage of trading using opposite IShares MSCI and Breakwave Dry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, Breakwave Dry 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 Breakwave Dry will offset losses from the drop in Breakwave Dry's long position.| IShares MSCI vs. iShares MSCI Italy | IShares MSCI vs. iShares MSCI Netherlands | IShares MSCI vs. iShares MSCI Spain | IShares MSCI vs. iShares MSCI Belgium |
| Breakwave Dry vs. SonicShares Global Shipping | Breakwave Dry vs. KraneShares Global Carbon | Breakwave Dry vs. iPath Series B | Breakwave Dry vs. Danaos |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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