Correlation Between Morgan Stanley and Emerging Europe
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and Emerging Europe 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 Morgan Stanley and Emerging Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley India and Emerging Europe Fund, you can compare the effects of market volatilities on Morgan Stanley and Emerging Europe 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 Morgan Stanley with a short position of Emerging Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and Emerging Europe.
Diversification Opportunities for Morgan Stanley and Emerging Europe
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Morgan and Emerging is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley India and Emerging Europe Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Europe and Morgan Stanley 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 Morgan Stanley India are associated (or correlated) with Emerging Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Europe has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and Emerging Europe go up and down completely randomly.
Pair Corralation between Morgan Stanley and Emerging Europe
If you would invest 2,480 in Morgan Stanley India on September 1, 2024 and sell it today you would earn a total of 341.00 from holding Morgan Stanley India or generate 13.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.79% |
| Values | Daily Returns |
Morgan Stanley India vs. Emerging Europe Fund
Performance |
| Timeline |
| Morgan Stanley India |
| Emerging Europe |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Morgan Stanley and Emerging Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and Emerging Europe
The main advantage of trading using opposite Morgan Stanley and Emerging Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, Emerging Europe 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 Emerging Europe will offset losses from the drop in Emerging Europe's long position.| Morgan Stanley vs. Aberdeen Income Credit | Morgan Stanley vs. BlackRock Utility Infrastructure | Morgan Stanley vs. Aberdeen Australia Ef | Morgan Stanley vs. Pgim High Yield |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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