Correlation Between MAYBANK EMERGING and SmartETFs Asia
Can any of the company-specific risk be diversified away by investing in both MAYBANK EMERGING and SmartETFs Asia 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 MAYBANK EMERGING and SmartETFs Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAYBANK EMERGING ETF and SmartETFs Asia Pacific, you can compare the effects of market volatilities on MAYBANK EMERGING and SmartETFs Asia 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 MAYBANK EMERGING with a short position of SmartETFs Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAYBANK EMERGING and SmartETFs Asia.
Diversification Opportunities for MAYBANK EMERGING and SmartETFs Asia
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between MAYBANK and SmartETFs is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding MAYBANK EMERGING ETF and SmartETFs Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SmartETFs Asia Pacific and MAYBANK EMERGING 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 MAYBANK EMERGING ETF are associated (or correlated) with SmartETFs Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SmartETFs Asia Pacific has no effect on the direction of MAYBANK EMERGING i.e., MAYBANK EMERGING and SmartETFs Asia go up and down completely randomly.
Pair Corralation between MAYBANK EMERGING and SmartETFs Asia
Considering the 90-day investment horizon MAYBANK EMERGING ETF is expected to generate 0.93 times more return on investment than SmartETFs Asia. However, MAYBANK EMERGING ETF is 1.08 times less risky than SmartETFs Asia. It trades about 0.05 of its potential returns per unit of risk. SmartETFs Asia Pacific is currently generating about 0.03 per unit of risk. If you would invest 3,066 in MAYBANK EMERGING ETF on August 28, 2024 and sell it today you would earn a total of 122.00 from holding MAYBANK EMERGING ETF or generate 3.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAYBANK EMERGING ETF vs. SmartETFs Asia Pacific
Performance |
| Timeline |
| MAYBANK EMERGING ETF |
| SmartETFs Asia Pacific |
MAYBANK EMERGING and SmartETFs Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAYBANK EMERGING and SmartETFs Asia
The main advantage of trading using opposite MAYBANK EMERGING and SmartETFs Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAYBANK EMERGING position performs unexpectedly, SmartETFs Asia 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 SmartETFs Asia will offset losses from the drop in SmartETFs Asia's long position.| MAYBANK EMERGING vs. Invesco PureBeta MSCI | MAYBANK EMERGING vs. Aquagold International | MAYBANK EMERGING vs. Morningstar Unconstrained Allocation | MAYBANK EMERGING vs. High Yield Municipal Fund |
| SmartETFs Asia vs. Matthews China Active | SmartETFs Asia vs. MAYBANK EMERGING ETF | SmartETFs Asia vs. Matthews Emerging Markets | SmartETFs Asia vs. JP Morgan Exchange Traded |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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