Correlation Between IShares MSCI and VanEck CMCI
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and VanEck CMCI 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 MSCI and VanEck CMCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI China and VanEck CMCI Commodity, you can compare the effects of market volatilities on IShares MSCI and VanEck CMCI 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 MSCI with a short position of VanEck CMCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and VanEck CMCI.
Diversification Opportunities for IShares MSCI and VanEck CMCI
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and VanEck is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI China and VanEck CMCI Commodity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck CMCI Commodity and IShares 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 iShares MSCI China are associated (or correlated) with VanEck CMCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck CMCI Commodity has no effect on the direction of IShares MSCI i.e., IShares MSCI and VanEck CMCI go up and down completely randomly.
Pair Corralation between IShares MSCI and VanEck CMCI
Given the investment horizon of 90 days iShares MSCI China is expected to generate 0.61 times more return on investment than VanEck CMCI. However, iShares MSCI China is 1.63 times less risky than VanEck CMCI. It trades about 0.19 of its potential returns per unit of risk. VanEck CMCI Commodity is currently generating about -0.08 per unit of risk. If you would invest 4,686 in iShares MSCI China on November 1, 2024 and sell it today you would earn a total of 257.00 from holding iShares MSCI China or generate 5.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares MSCI China vs. VanEck CMCI Commodity
Performance |
| Timeline |
| iShares MSCI China |
| VanEck CMCI Commodity |
IShares MSCI and VanEck CMCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and VanEck CMCI
The main advantage of trading using opposite IShares MSCI and VanEck CMCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, VanEck CMCI 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 VanEck CMCI will offset losses from the drop in VanEck CMCI's long position.| IShares MSCI vs. KraneShares CSI China | IShares MSCI vs. Invesco China Technology | IShares MSCI vs. iShares MSCI India | IShares MSCI vs. Xtrackers Harvest CSI |
| VanEck CMCI vs. Freedom Day Dividend | VanEck CMCI vs. Franklin Templeton ETF | VanEck CMCI vs. iShares MSCI China | VanEck CMCI vs. Tidal Trust II |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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