Correlation Between Vanguard and Amundi MSCI
Can any of the company-specific risk be diversified away by investing in both Vanguard and Amundi 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 Vanguard and Amundi MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard SP 500 and Amundi MSCI Future, you can compare the effects of market volatilities on Vanguard and Amundi 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 Vanguard with a short position of Amundi MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard and Amundi MSCI.
Diversification Opportunities for Vanguard and Amundi MSCI
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Amundi is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard SP 500 and Amundi MSCI Future in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI Future and Vanguard 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 Vanguard SP 500 are associated (or correlated) with Amundi MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi MSCI Future has no effect on the direction of Vanguard i.e., Vanguard and Amundi MSCI go up and down completely randomly.
Pair Corralation between Vanguard and Amundi MSCI
Assuming the 90 days trading horizon Vanguard SP 500 is expected to generate 0.54 times more return on investment than Amundi MSCI. However, Vanguard SP 500 is 1.85 times less risky than Amundi MSCI. It trades about 0.15 of its potential returns per unit of risk. Amundi MSCI Future is currently generating about 0.07 per unit of risk. If you would invest 7,127 in Vanguard SP 500 on October 25, 2024 and sell it today you would earn a total of 3,365 from holding Vanguard SP 500 or generate 47.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard SP 500 vs. Amundi MSCI Future
Performance |
| Timeline |
| Vanguard SP 500 |
| Amundi MSCI Future |
Vanguard and Amundi MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard and Amundi MSCI
The main advantage of trading using opposite Vanguard and Amundi MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard position performs unexpectedly, Amundi 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 Amundi MSCI will offset losses from the drop in Amundi MSCI's long position.| Vanguard vs. Vanguard FTSE Emerging | Vanguard vs. Vanguard USD Emerging | Vanguard vs. Vanguard FTSE Developed | Vanguard vs. Vanguard FTSE Japan |
| Amundi MSCI vs. UBSFund Solutions MSCI | Amundi MSCI vs. Vanguard SP 500 | Amundi MSCI vs. iShares VII PLC | Amundi MSCI vs. iShares Core SP |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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