Correlation Between Ishares Msci and Knights Of

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

By analyzing existing cross correlation between Ishares Msci Eafe and Knights Of Umbus, you can compare the effects of market volatilities on Ishares Msci and Knights Of 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 Ishares Msci with a short position of Knights Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ishares Msci and Knights Of.

Diversification Opportunities for Ishares Msci and Knights Of

0.97

Correlation Coefficient

Ishares Msci  Knights Of

Almost no diversification

The 3 months correlation between Ishares and Knights is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Ishares Msci Eafe and Knights Of Umbus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knights Of Umbus and Ishares 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 Ishares Msci Eafe are associated (or correlated) with Knights Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knights Of Umbus has no effect on the direction of Ishares Msci i.e., Ishares Msci and Knights Of go up and down completely randomly.

Pair Corralation between Ishares Msci and Knights Of

Assuming the 90 days horizon Ishares Msci is expected to generate 1.23 times less return on investment than Knights Of. In addition to that, Ishares Msci is 1.13 times more volatile than Knights Of Umbus. It trades about 0.03 of its total potential returns per unit of risk. Knights Of Umbus is currently generating about 0.04 per unit of volatility. If you would invest  1,084  in Knights Of Umbus on October 8, 2024 and sell it today you would earn a total of  147.00  from holding Knights Of Umbus or generate 13.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Ishares Msci Eafe  vs.  Knights Of Umbus

Ishares Msci Eafe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ishares Msci Eafe has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Knights Of Umbus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Knights Of Umbus has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Ishares Msci and Knights Of

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

The idea behind Ishares Msci Eafe and Knights Of Umbus 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.

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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.