Correlation Between Ishares Msci and Segall Bryant

Can any of the company-specific risk be diversified away by investing in both Ishares Msci and Segall Bryant 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 Segall Bryant 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 Segall Bryant Hamill, you can compare the effects of market volatilities on Ishares Msci and Segall Bryant 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 Segall Bryant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ishares Msci and Segall Bryant.

Diversification Opportunities for Ishares Msci and Segall Bryant

0.04

Correlation Coefficient

Ishares Msci  Segall Bryant

Significant diversification

The 3 months correlation between Ishares and Segall is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Ishares Msci Eafe and Segall Bryant Hamill in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Segall Bryant Hamill 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 Segall Bryant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Segall Bryant Hamill has no effect on the direction of Ishares Msci i.e., Ishares Msci and Segall Bryant go up and down completely randomly.

Pair Corralation between Ishares Msci and Segall Bryant

Assuming the 90 days horizon Ishares Msci Eafe is expected to generate 0.76 times more return on investment than Segall Bryant. However, Ishares Msci Eafe is 1.31 times less risky than Segall Bryant. It trades about 0.06 of its potential returns per unit of risk. Segall Bryant Hamill is currently generating about 0.03 per unit of risk. If you would invest  1,281  in Ishares Msci Eafe on December 2, 2024 and sell it today you would earn a total of  349.00  from holding Ishares Msci Eafe or generate 27.24% return on investment over 90 days.

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

Ishares Msci Eafe  vs.  Segall Bryant Hamill

Ishares Msci Eafe

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ishares Msci Eafe are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Ishares Msci is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Segall Bryant Hamill

Risk-Adjusted Performance

Very Weak

Over the last 90 days Segall Bryant Hamill has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Ishares Msci and Segall Bryant

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

The idea behind Ishares Msci Eafe and Segall Bryant Hamill 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.