Correlation Between Xtrackers MSCI and Amundi EUR
Can any of the company-specific risk be diversified away by investing in both Xtrackers MSCI and Amundi EUR 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 Xtrackers MSCI and Amundi EUR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers MSCI and Amundi EUR High, you can compare the effects of market volatilities on Xtrackers MSCI and Amundi EUR 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 Xtrackers MSCI with a short position of Amundi EUR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers MSCI and Amundi EUR.
Diversification Opportunities for Xtrackers MSCI and Amundi EUR
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xtrackers and Amundi is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers MSCI and Amundi EUR High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi EUR High and Xtrackers MSCI 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 Xtrackers MSCI are associated (or correlated) with Amundi EUR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi EUR High has no effect on the direction of Xtrackers MSCI i.e., Xtrackers MSCI and Amundi EUR go up and down completely randomly.
Pair Corralation between Xtrackers MSCI and Amundi EUR
Assuming the 90 days trading horizon Xtrackers MSCI is expected to under-perform the Amundi EUR. In addition to that, Xtrackers MSCI is 9.32 times more volatile than Amundi EUR High. It trades about -0.19 of its total potential returns per unit of risk. Amundi EUR High is currently generating about 0.14 per unit of volatility. If you would invest 10,627 in Amundi EUR High on August 24, 2024 and sell it today you would earn a total of 42.00 from holding Amundi EUR High or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers MSCI vs. Amundi EUR High
Performance |
| Timeline |
| Xtrackers MSCI |
| Amundi EUR High |
Xtrackers MSCI and Amundi EUR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers MSCI and Amundi EUR
The main advantage of trading using opposite Xtrackers MSCI and Amundi EUR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers MSCI position performs unexpectedly, Amundi EUR 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 EUR will offset losses from the drop in Amundi EUR's long position.| Xtrackers MSCI vs. Leverage Shares 3x | Xtrackers MSCI vs. WisdomTree SP 500 | Xtrackers MSCI vs. WisdomTree Silver 3x | Xtrackers MSCI vs. Leverage Shares 3x |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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