Correlation Between Morgan Stanley and KEYCORP

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

By analyzing existing cross correlation between Morgan Stanley ETF and KEYCORP MEDIUM TERM, you can compare the effects of market volatilities on Morgan Stanley and KEYCORP 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 Morgan Stanley with a short position of KEYCORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and KEYCORP.

Diversification Opportunities for Morgan Stanley and KEYCORP

0.0

Correlation Coefficient

Morgan Stanley  KEYCORP

Pay attention - limited upside

The 3 months correlation between Morgan and KEYCORP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley ETF and KEYCORP MEDIUM TERM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEYCORP MEDIUM TERM and Morgan Stanley 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 Morgan Stanley ETF are associated (or correlated) with KEYCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEYCORP MEDIUM TERM has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and KEYCORP go up and down completely randomly.

Pair Corralation between Morgan Stanley and KEYCORP

If you would invest  9,933  in KEYCORP MEDIUM TERM on December 24, 2024 and sell it today you would earn a total of  20.00  from holding KEYCORP MEDIUM TERM or generate 0.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Morgan Stanley ETF  vs.  KEYCORP MEDIUM TERM

Morgan Stanley ETF

Risk-Adjusted Performance

Modest

Over the last 90 days Morgan Stanley ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Morgan Stanley is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

KEYCORP MEDIUM TERM

Risk-Adjusted Performance

Very Weak

Over the last 90 days KEYCORP MEDIUM TERM has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, KEYCORP is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Morgan Stanley and KEYCORP

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

The idea behind Morgan Stanley ETF and KEYCORP MEDIUM TERM 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.