Correlation Between IShares Core and Amundi ETF
Can any of the company-specific risk be diversified away by investing in both IShares Core and Amundi ETF 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 Core and Amundi ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Core MSCI and Amundi ETF MSCI, you can compare the effects of market volatilities on IShares Core and Amundi ETF 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 Core with a short position of Amundi ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Core and Amundi ETF.
Diversification Opportunities for IShares Core and Amundi ETF
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and Amundi is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core MSCI and Amundi ETF MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi ETF MSCI and IShares Core 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 Core MSCI are associated (or correlated) with Amundi ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi ETF MSCI has no effect on the direction of IShares Core i.e., IShares Core and Amundi ETF go up and down completely randomly.
Pair Corralation between IShares Core and Amundi ETF
Assuming the 90 days trading horizon iShares Core MSCI is expected to generate 1.23 times more return on investment than Amundi ETF. However, IShares Core is 1.23 times more volatile than Amundi ETF MSCI. It trades about -0.04 of its potential returns per unit of risk. Amundi ETF MSCI is currently generating about -0.22 per unit of risk. If you would invest 458.00 in iShares Core MSCI on August 30, 2024 and sell it today you would lose (4.00) from holding iShares Core MSCI or give up 0.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Core MSCI vs. Amundi ETF MSCI
Performance |
| Timeline |
| iShares Core MSCI |
| Amundi ETF MSCI |
IShares Core and Amundi ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Core and Amundi ETF
The main advantage of trading using opposite IShares Core and Amundi ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Core position performs unexpectedly, Amundi ETF 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 ETF will offset losses from the drop in Amundi ETF's long position.The idea behind iShares Core MSCI and Amundi ETF MSCI 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.| Amundi ETF vs. Amundi MSCI Europe | Amundi ETF vs. Amundi SP 500 | Amundi ETF vs. Amundi Index Solutions | Amundi ETF vs. Amundi Euro 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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