Correlation Between HSBC SP and Amundi MSCI
Can any of the company-specific risk be diversified away by investing in both HSBC SP and Amundi 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 HSBC SP and Amundi MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HSBC SP 500 and Amundi MSCI Europe, you can compare the effects of market volatilities on HSBC SP and Amundi 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 HSBC SP with a short position of Amundi MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of HSBC SP and Amundi MSCI.
Diversification Opportunities for HSBC SP and Amundi MSCI
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HSBC and Amundi is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding HSBC SP 500 and Amundi MSCI Europe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI Europe and HSBC SP 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 HSBC SP 500 are associated (or correlated) with Amundi MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi MSCI Europe has no effect on the direction of HSBC SP i.e., HSBC SP and Amundi MSCI go up and down completely randomly.
Pair Corralation between HSBC SP and Amundi MSCI
Assuming the 90 days trading horizon HSBC SP 500 is expected to generate 0.86 times more return on investment than Amundi MSCI. However, HSBC SP 500 is 1.17 times less risky than Amundi MSCI. It trades about 0.11 of its potential returns per unit of risk. Amundi MSCI Europe is currently generating about 0.05 per unit of risk. If you would invest 3,700 in HSBC SP 500 on September 2, 2024 and sell it today you would earn a total of 2,083 from holding HSBC SP 500 or generate 56.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HSBC SP 500 vs. Amundi MSCI Europe
Performance |
| Timeline |
| HSBC SP 500 |
| Amundi MSCI Europe |
HSBC SP and Amundi MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HSBC SP and Amundi MSCI
The main advantage of trading using opposite HSBC SP and Amundi MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HSBC SP position performs unexpectedly, Amundi 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 Amundi MSCI will offset losses from the drop in Amundi MSCI's long position.| HSBC SP vs. Lyxor MSCI China | HSBC SP vs. Manitou BF SA | HSBC SP vs. Granite 3x LVMH | HSBC SP vs. 21Shares Polkadot ETP |
| Amundi MSCI vs. Amundi Index Solutions | Amundi MSCI vs. Amundi Index Solutions | Amundi MSCI vs. Amundi Index Solutions | Amundi MSCI vs. Amundi SP 500 |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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