Correlation Between Morgan Stanley and Stack Capital
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and Stack Capital 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 Stack Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley CDR and Stack Capital Group, you can compare the effects of market volatilities on Morgan Stanley and Stack Capital 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 Stack Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and Stack Capital.
Diversification Opportunities for Morgan Stanley and Stack Capital
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Morgan and Stack is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley CDR and Stack Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stack Capital Group 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 CDR are associated (or correlated) with Stack Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stack Capital Group has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and Stack Capital go up and down completely randomly.
Pair Corralation between Morgan Stanley and Stack Capital
Assuming the 90 days horizon Morgan Stanley is expected to generate 6.33 times less return on investment than Stack Capital. But when comparing it to its historical volatility, Morgan Stanley CDR is 1.77 times less risky than Stack Capital. It trades about 0.07 of its potential returns per unit of risk. Stack Capital Group is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 1,250 in Stack Capital Group on November 16, 2025 and sell it today you would earn a total of 696.00 from holding Stack Capital Group or generate 55.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.41% |
| Values | Daily Returns |
Morgan Stanley CDR vs. Stack Capital Group
Performance |
| Timeline |
| Morgan Stanley CDR |
| Stack Capital Group |
Morgan Stanley and Stack Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and Stack Capital
The main advantage of trading using opposite Morgan Stanley and Stack Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, Stack Capital 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 Stack Capital will offset losses from the drop in Stack Capital's long position.| Morgan Stanley vs. Arizona Gold Silver | Morgan Stanley vs. Richelieu Hardware | Morgan Stanley vs. CNJ Capital Investments | Morgan Stanley vs. Nicola Mining |
| Stack Capital vs. Global Dividend Growth | Stack Capital vs. Dividend 15 Split | Stack Capital vs. Premium Income | Stack Capital vs. Canadian Life Companies |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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