Correlation Between Vanguard FTSE and Amundi MSCI
Can any of the company-specific risk be diversified away by investing in both Vanguard FTSE 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 FTSE 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 FTSE Developed and Amundi MSCI World, you can compare the effects of market volatilities on Vanguard FTSE 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 FTSE with a short position of Amundi MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard FTSE and Amundi MSCI.
Diversification Opportunities for Vanguard FTSE and Amundi MSCI
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vanguard and Amundi is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard FTSE Developed and Amundi MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI World and Vanguard FTSE 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 FTSE Developed 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 World has no effect on the direction of Vanguard FTSE i.e., Vanguard FTSE and Amundi MSCI go up and down completely randomly.
Pair Corralation between Vanguard FTSE and Amundi MSCI
Assuming the 90 days trading horizon Vanguard FTSE is expected to generate 1.71 times less return on investment than Amundi MSCI. In addition to that, Vanguard FTSE is 1.15 times more volatile than Amundi MSCI World. It trades about 0.05 of its total potential returns per unit of risk. Amundi MSCI World is currently generating about 0.1 per unit of volatility. If you would invest 41,425 in Amundi MSCI World on August 30, 2024 and sell it today you would earn a total of 18,685 from holding Amundi MSCI World or generate 45.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Vanguard FTSE Developed vs. Amundi MSCI World
Performance |
| Timeline |
| Vanguard FTSE Developed |
| Amundi MSCI World |
Vanguard FTSE and Amundi MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard FTSE and Amundi MSCI
The main advantage of trading using opposite Vanguard FTSE and Amundi MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard FTSE 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 FTSE vs. Vanguard USD Corporate | Vanguard FTSE vs. Vanguard Global Aggregate | Vanguard FTSE vs. Vanguard USD Corporate | Vanguard FTSE vs. Vanguard FTSE All World |
| Amundi MSCI vs. Amundi EUR High | Amundi MSCI vs. Amundi Index Solutions | Amundi MSCI vs. Amundi MSCI Pacific | Amundi MSCI vs. Amundi MSCI Europe |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |