Correlation Between IShares UBS and IShares MSCI
Can any of the company-specific risk be diversified away by investing in both IShares UBS and IShares 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 UBS and IShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares UBS Government and iShares MSCI Emerging, you can compare the effects of market volatilities on IShares UBS and IShares 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 UBS with a short position of IShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares UBS and IShares MSCI.
Diversification Opportunities for IShares UBS and IShares MSCI
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IShares and IShares is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding iShares UBS Government and iShares MSCI Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares MSCI Emerging and IShares UBS 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 UBS Government are associated (or correlated) with IShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares MSCI Emerging has no effect on the direction of IShares UBS i.e., IShares UBS and IShares MSCI go up and down completely randomly.
Pair Corralation between IShares UBS and IShares MSCI
Assuming the 90 days trading horizon iShares UBS Government is expected to generate 0.65 times more return on investment than IShares MSCI. However, iShares UBS Government is 1.53 times less risky than IShares MSCI. It trades about 0.16 of its potential returns per unit of risk. iShares MSCI Emerging is currently generating about -0.27 per unit of risk. If you would invest 12,382 in iShares UBS Government on September 1, 2024 and sell it today you would earn a total of 131.00 from holding iShares UBS Government or generate 1.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
iShares UBS Government vs. iShares MSCI Emerging
Performance |
| Timeline |
| iShares UBS Government |
| iShares MSCI Emerging |
IShares UBS and IShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares UBS and IShares MSCI
The main advantage of trading using opposite IShares UBS and IShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares UBS position performs unexpectedly, IShares 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 IShares MSCI will offset losses from the drop in IShares MSCI's long position.| IShares UBS vs. iShares MSCI Emerging | IShares UBS vs. iShares Global Aggregate | IShares UBS vs. iShares CoreSP MidCap | IShares UBS vs. iShares SP 500 |
| IShares MSCI vs. BetaShares Global Banks | IShares MSCI vs. Beta Shares SPASX | IShares MSCI vs. SPDR SPASX 200 | IShares MSCI vs. Vanguard Australian Property |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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