Correlation Between IShares and Xtrackers MSCI
Can any of the company-specific risk be diversified away by investing in both IShares and Xtrackers 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 and Xtrackers MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IShares and Xtrackers MSCI EAFE, you can compare the effects of market volatilities on IShares and Xtrackers 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 with a short position of Xtrackers MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares and Xtrackers MSCI.
Diversification Opportunities for IShares and Xtrackers MSCI
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between IShares and Xtrackers is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding IShares and Xtrackers MSCI EAFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers MSCI EAFE and IShares 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 are associated (or correlated) with Xtrackers MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers MSCI EAFE has no effect on the direction of IShares i.e., IShares and Xtrackers MSCI go up and down completely randomly.
Pair Corralation between IShares and Xtrackers MSCI
If you would invest 4,175 in Xtrackers MSCI EAFE on August 25, 2024 and sell it today you would earn a total of 4.00 from holding Xtrackers MSCI EAFE or generate 0.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
IShares vs. Xtrackers MSCI EAFE
Performance |
| Timeline |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Xtrackers MSCI EAFE |
IShares and Xtrackers MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares and Xtrackers MSCI
The main advantage of trading using opposite IShares and Xtrackers MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares position performs unexpectedly, Xtrackers 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 Xtrackers MSCI will offset losses from the drop in Xtrackers MSCI's long position.| IShares vs. iShares MSCI Hong | IShares vs. HUMANA INC | IShares vs. SCOR PK | IShares vs. Aquagold International |
| Xtrackers MSCI vs. Dimensional Core Equity | Xtrackers MSCI vs. Dimensional Emerging Core | Xtrackers MSCI vs. Dimensional Targeted Value | Xtrackers MSCI vs. Dimensional Small Cap |
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 CEOs Directory module to screen CEOs from public companies around the world.
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