Correlation Between Morgan Stanley and China Union
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By analyzing existing cross correlation between Morgan Stanley Direct and China Union Holdings, you can compare the effects of market volatilities on Morgan Stanley and China Union 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 China Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and China Union.
Diversification Opportunities for Morgan Stanley and China Union
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Morgan and China is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley Direct and China Union Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Union Holdings 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 Direct are associated (or correlated) with China Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Union Holdings has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and China Union go up and down completely randomly.
Pair Corralation between Morgan Stanley and China Union
Given the investment horizon of 90 days Morgan Stanley Direct is expected to generate 0.51 times more return on investment than China Union. However, Morgan Stanley Direct is 1.95 times less risky than China Union. It trades about 0.1 of its potential returns per unit of risk. China Union Holdings is currently generating about -0.62 per unit of risk. If you would invest 2,074 in Morgan Stanley Direct on September 27, 2024 and sell it today you would earn a total of 46.00 from holding Morgan Stanley Direct or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Morgan Stanley Direct vs. China Union Holdings
Performance |
| Timeline |
| Morgan Stanley Direct |
| China Union Holdings |
Morgan Stanley and China Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and China Union
The main advantage of trading using opposite Morgan Stanley and China Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, China Union 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 China Union will offset losses from the drop in China Union's long position.| Morgan Stanley vs. FactSet Research Systems | Morgan Stanley vs. Arrow Electronics | Morgan Stanley vs. Sphere Entertainment Co | Morgan Stanley vs. Iridium Communications |
| China Union vs. PetroChina Co Ltd | China Union vs. China Mobile Limited | China Union vs. CNOOC Limited | China Union vs. Ping An Insurance |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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