Correlation Between Enter Air and MSCI

Can any of the company-specific risk be diversified away by investing in both Enter Air and 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 Enter Air and MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Enter Air SA and MSCI Inc, you can compare the effects of market volatilities on Enter Air and 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 Enter Air with a short position of MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enter Air and MSCI.

Diversification Opportunities for Enter Air and MSCI

-0.8

Correlation Coefficient

Enter Air  MSCI

Pay attention - limited upside

The 3 months correlation between Enter and MSCI is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Enter Air SA and MSCI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MSCI Inc and Enter Air 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 Enter Air SA are associated (or correlated) with MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MSCI Inc has no effect on the direction of Enter Air i.e., Enter Air and MSCI go up and down completely randomly.

Pair Corralation between Enter Air and MSCI

Assuming the 90 days trading horizon Enter Air SA is expected to generate 1.07 times more return on investment than MSCI. However, Enter Air is 1.07 times more volatile than MSCI Inc. It trades about 0.15 of its potential returns per unit of risk. MSCI Inc is currently generating about -0.08 per unit of risk. If you would invest  1,124  in Enter Air SA on December 29, 2024 and sell it today you would earn a total of  186.00  from holding Enter Air SA or generate 16.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Enter Air SA  vs.  MSCI Inc

Enter Air SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Enter Air SA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Enter Air unveiled solid returns over the last few months and may actually be approaching a breakup point.

MSCI Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days MSCI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Enter Air and MSCI

The main advantage of trading using opposite Enter Air and MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enter Air position performs unexpectedly, 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 MSCI will offset losses from the drop in MSCI's long position.

The idea behind Enter Air SA and MSCI Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.