Correlation Between Amundi Index and HSBC MSCI
Can any of the company-specific risk be diversified away by investing in both Amundi Index and HSBC 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 Amundi Index and HSBC MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Index Solutions and HSBC MSCI Japan, you can compare the effects of market volatilities on Amundi Index and HSBC 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 Amundi Index with a short position of HSBC MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Index and HSBC MSCI.
Diversification Opportunities for Amundi Index and HSBC MSCI
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amundi and HSBC is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Index Solutions and HSBC MSCI Japan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC MSCI Japan and Amundi Index 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 Amundi Index Solutions are associated (or correlated) with HSBC MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSBC MSCI Japan has no effect on the direction of Amundi Index i.e., Amundi Index and HSBC MSCI go up and down completely randomly.
Pair Corralation between Amundi Index and HSBC MSCI
Assuming the 90 days trading horizon Amundi Index Solutions is expected to under-perform the HSBC MSCI. In addition to that, Amundi Index is 2.57 times more volatile than HSBC MSCI Japan. It trades about -0.09 of its total potential returns per unit of risk. HSBC MSCI Japan is currently generating about 0.08 per unit of volatility. If you would invest 3,749 in HSBC MSCI Japan on October 9, 2024 and sell it today you would earn a total of 98.00 from holding HSBC MSCI Japan or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.5% |
| Values | Daily Returns |
Amundi Index Solutions vs. HSBC MSCI Japan
Performance |
| Timeline |
| Amundi Index Solutions |
| HSBC MSCI Japan |
Amundi Index and HSBC MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Index and HSBC MSCI
The main advantage of trading using opposite Amundi Index and HSBC MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Index position performs unexpectedly, HSBC 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 HSBC MSCI will offset losses from the drop in HSBC MSCI's long position.The idea behind Amundi Index Solutions and HSBC MSCI Japan pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| HSBC MSCI vs. HSBC MSCI China | HSBC MSCI vs. HSBC Emerging Market | HSBC MSCI vs. HSBC USA Sustainable | HSBC MSCI vs. HSBC MSCI USA |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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