Correlation Between IShares MSCI and ProShares MSCI
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and ProShares 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 IShares MSCI and ProShares MSCI 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 ProShares MSCI Europe, you can compare the effects of market volatilities on IShares MSCI and ProShares 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 IShares MSCI with a short position of ProShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and ProShares MSCI.
Diversification Opportunities for IShares MSCI and ProShares MSCI
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IShares and ProShares is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI France and ProShares MSCI Europe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares MSCI Europe 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 ProShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares MSCI Europe has no effect on the direction of IShares MSCI i.e., IShares MSCI and ProShares MSCI go up and down completely randomly.
Pair Corralation between IShares MSCI and ProShares MSCI
Considering the 90-day investment horizon IShares MSCI is expected to generate 1.31 times less return on investment than ProShares MSCI. In addition to that, IShares MSCI is 1.22 times more volatile than ProShares MSCI Europe. It trades about 0.04 of its total potential returns per unit of risk. ProShares MSCI Europe is currently generating about 0.06 per unit of volatility. If you would invest 3,867 in ProShares MSCI Europe on September 12, 2024 and sell it today you would earn a total of 986.00 from holding ProShares MSCI Europe or generate 25.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
iShares MSCI France vs. ProShares MSCI Europe
Performance |
| Timeline |
| iShares MSCI France |
| ProShares MSCI Europe |
IShares MSCI and ProShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and ProShares MSCI
The main advantage of trading using opposite IShares MSCI and ProShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, ProShares 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 ProShares MSCI will offset losses from the drop in ProShares MSCI's long position.| IShares MSCI vs. iShares MSCI Qatar | IShares MSCI vs. iShares MSCI Israel | IShares MSCI vs. iShares MSCI Philippines |
| ProShares MSCI vs. iShares MSCI France | ProShares MSCI vs. iShares Europe ETF | ProShares MSCI vs. iShares MSCI United | ProShares MSCI vs. iShares MSCI Spain |
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.
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