Correlation Between HSBC MSCI and UBSFund Solutions
Can any of the company-specific risk be diversified away by investing in both HSBC MSCI and UBSFund Solutions 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 MSCI and UBSFund Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HSBC MSCI Japan and UBSFund Solutions MSCI, you can compare the effects of market volatilities on HSBC MSCI and UBSFund Solutions 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 MSCI with a short position of UBSFund Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of HSBC MSCI and UBSFund Solutions.
Diversification Opportunities for HSBC MSCI and UBSFund Solutions
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HSBC and UBSFund is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding HSBC MSCI Japan and UBSFund Solutions MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBSFund Solutions MSCI and HSBC 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 HSBC MSCI Japan are associated (or correlated) with UBSFund Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBSFund Solutions MSCI has no effect on the direction of HSBC MSCI i.e., HSBC MSCI and UBSFund Solutions go up and down completely randomly.
Pair Corralation between HSBC MSCI and UBSFund Solutions
Assuming the 90 days trading horizon HSBC MSCI Japan is expected to under-perform the UBSFund Solutions. But the etf apears to be less risky and, when comparing its historical volatility, HSBC MSCI Japan is 1.17 times less risky than UBSFund Solutions. The etf trades about -0.08 of its potential returns per unit of risk. The UBSFund Solutions MSCI is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 4,695 in UBSFund Solutions MSCI on September 1, 2024 and sell it today you would earn a total of 141.00 from holding UBSFund Solutions MSCI or generate 3.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HSBC MSCI Japan vs. UBSFund Solutions MSCI
Performance |
| Timeline |
| HSBC MSCI Japan |
| UBSFund Solutions MSCI |
HSBC MSCI and UBSFund Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HSBC MSCI and UBSFund Solutions
The main advantage of trading using opposite HSBC MSCI and UBSFund Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HSBC MSCI position performs unexpectedly, UBSFund Solutions 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 UBSFund Solutions will offset losses from the drop in UBSFund Solutions' long position.| HSBC MSCI vs. UBSFund Solutions MSCI | HSBC MSCI vs. Vanguard SP 500 | HSBC MSCI vs. iShares VII PLC | HSBC MSCI vs. iShares Core SP |
| UBSFund Solutions vs. iShares Core SP | UBSFund Solutions vs. iShares Core MSCI | UBSFund Solutions vs. Lyxor UCITS Stoxx |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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