Correlation Between Aston/crosswind Small and Msif Real

Can any of the company-specific risk be diversified away by investing in both Aston/crosswind Small and Msif Real 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 Aston/crosswind Small and Msif Real into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Astoncrosswind Small Cap and Msif Real Estate, you can compare the effects of market volatilities on Aston/crosswind Small and Msif Real 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 Aston/crosswind Small with a short position of Msif Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aston/crosswind Small and Msif Real.

Diversification Opportunities for Aston/crosswind Small and Msif Real

0.21

Correlation Coefficient

Aston/crosswind Small  Msif Real

Modest diversification

The 3 months correlation between Aston/crosswind and Msif is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Astoncrosswind Small Cap and Msif Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Msif Real Estate and Aston/crosswind Small 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 Astoncrosswind Small Cap are associated (or correlated) with Msif Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Msif Real Estate has no effect on the direction of Aston/crosswind Small i.e., Aston/crosswind Small and Msif Real go up and down completely randomly.

Pair Corralation between Aston/crosswind Small and Msif Real

Assuming the 90 days horizon Aston/crosswind Small is expected to generate 1.37 times less return on investment than Msif Real. In addition to that, Aston/crosswind Small is 1.15 times more volatile than Msif Real Estate. It trades about 0.06 of its total potential returns per unit of risk. Msif Real Estate is currently generating about 0.09 per unit of volatility. If you would invest  868.00  in Msif Real Estate on October 9, 2024 and sell it today you would earn a total of  158.00  from holding Msif Real Estate or generate 18.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	88.66%
Values	Daily Returns

Astoncrosswind Small Cap  vs.  Msif Real Estate

Astoncrosswind Small Cap

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Astoncrosswind Small Cap are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Aston/crosswind Small is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Msif Real Estate

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Msif Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly weak basic indicators, Msif Real may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Aston/crosswind Small and Msif Real

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

The idea behind Astoncrosswind Small Cap and Msif Real Estate 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.