Correlation Between IShares MSCI and NESNVX

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

By analyzing existing cross correlation between iShares MSCI China and NESNVX 35 24 SEP 25, you can compare the effects of market volatilities on IShares MSCI and NESNVX 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 NESNVX. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and NESNVX.

Diversification Opportunities for IShares MSCI and NESNVX

-0.57

Correlation Coefficient

IShares MSCI  NESNVX

Excellent diversification

The 3 months correlation between IShares and NESNVX is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI China and NESNVX 35 24 SEP 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NESNVX 35 24 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 China are associated (or correlated) with NESNVX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NESNVX 35 24 has no effect on the direction of IShares MSCI i.e., IShares MSCI and NESNVX go up and down completely randomly.

Pair Corralation between IShares MSCI and NESNVX

Given the investment horizon of 90 days iShares MSCI China is expected to generate 4.68 times more return on investment than NESNVX. However, IShares MSCI is 4.68 times more volatile than NESNVX 35 24 SEP 25. It trades about 0.07 of its potential returns per unit of risk. NESNVX 35 24 SEP 25 is currently generating about -0.11 per unit of risk. If you would invest  4,055  in iShares MSCI China on October 3, 2024 and sell it today you would earn a total of  631.00  from holding iShares MSCI China or generate 15.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	41.67%
Values	Daily Returns

iShares MSCI China  vs.  NESNVX 35 24 SEP 25

iShares MSCI China

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares MSCI China has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Etf's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the Etf traders.

NESNVX 35 24

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NESNVX 35 24 SEP 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for NESNVX 35 24 SEP 25 investors.

Pair Trading with IShares MSCI and NESNVX

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

The idea behind iShares MSCI China and NESNVX 35 24 SEP 25 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.