Correlation Between Guinness Atkinson and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both Guinness Atkinson and Morgan Stanley 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 Guinness Atkinson and Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guinness Atkinson Alternative and Morgan Stanley Multi, you can compare the effects of market volatilities on Guinness Atkinson and Morgan Stanley 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 Guinness Atkinson with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guinness Atkinson and Morgan Stanley.
Diversification Opportunities for Guinness Atkinson and Morgan Stanley
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guinness and Morgan is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Guinness Atkinson Alternative and Morgan Stanley Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley Multi and Guinness Atkinson 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 Guinness Atkinson Alternative are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley Multi has no effect on the direction of Guinness Atkinson i.e., Guinness Atkinson and Morgan Stanley go up and down completely randomly.
Pair Corralation between Guinness Atkinson and Morgan Stanley
Assuming the 90 days horizon Guinness Atkinson Alternative is expected to under-perform the Morgan Stanley. But the mutual fund apears to be less risky and, when comparing its historical volatility, Guinness Atkinson Alternative is 1.84 times less risky than Morgan Stanley. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Morgan Stanley Multi is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,738 in Morgan Stanley Multi on August 30, 2024 and sell it today you would earn a total of 1,253 from holding Morgan Stanley Multi or generate 45.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guinness Atkinson Alternative vs. Morgan Stanley Multi
Performance |
| Timeline |
| Guinness Atkinson |
| Morgan Stanley Multi |
Guinness Atkinson and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guinness Atkinson and Morgan Stanley
The main advantage of trading using opposite Guinness Atkinson and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guinness Atkinson position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| Guinness Atkinson vs. Firsthand Alternative Energy | Guinness Atkinson vs. Portfolio 21 Global | Guinness Atkinson vs. HUMANA INC | Guinness Atkinson vs. Aquagold International |
| Morgan Stanley vs. Ivy Natural Resources | Morgan Stanley vs. Tortoise Energy Independence | Morgan Stanley vs. Victory Global Natural | Morgan Stanley vs. Guinness Atkinson Alternative |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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