Correlation Between Xtrackers MSCI and UBS Barclays
Can any of the company-specific risk be diversified away by investing in both Xtrackers MSCI and UBS Barclays 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 UBS Barclays into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers MSCI World and UBS Barclays Liquid, you can compare the effects of market volatilities on Xtrackers MSCI and UBS Barclays 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 UBS Barclays. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers MSCI and UBS Barclays.
Diversification Opportunities for Xtrackers MSCI and UBS Barclays
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtrackers and UBS is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers MSCI World and UBS Barclays Liquid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Barclays Liquid 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 World are associated (or correlated) with UBS Barclays. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Barclays Liquid has no effect on the direction of Xtrackers MSCI i.e., Xtrackers MSCI and UBS Barclays go up and down completely randomly.
Pair Corralation between Xtrackers MSCI and UBS Barclays
Assuming the 90 days trading horizon Xtrackers MSCI World is expected to generate 2.73 times more return on investment than UBS Barclays. However, Xtrackers MSCI is 2.73 times more volatile than UBS Barclays Liquid. It trades about 0.19 of its potential returns per unit of risk. UBS Barclays Liquid is currently generating about 0.22 per unit of risk. If you would invest 9,072 in Xtrackers MSCI World on September 2, 2024 and sell it today you would earn a total of 388.00 from holding Xtrackers MSCI World or generate 4.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers MSCI World vs. UBS Barclays Liquid
Performance |
| Timeline |
| Xtrackers MSCI World |
| UBS Barclays Liquid |
Xtrackers MSCI and UBS Barclays Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers MSCI and UBS Barclays
The main advantage of trading using opposite Xtrackers MSCI and UBS Barclays positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers MSCI position performs unexpectedly, UBS Barclays 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 UBS Barclays will offset losses from the drop in UBS Barclays' long position.| Xtrackers MSCI vs. Vanguard FTSE Developed | Xtrackers MSCI vs. Leverage Shares 2x | Xtrackers MSCI vs. Amundi Index Solutions | Xtrackers MSCI vs. Amundi Index Solutions |
| UBS Barclays vs. UBS ETF | UBS Barclays vs. UBS ETF plc | UBS Barclays vs. UBS ETF plc | UBS Barclays vs. UBS Fund Solutions |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |