Correlation Between IShares MSCI and NFO

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and NFO 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 NFO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IShares MSCI ACWI and NFO, you can compare the effects of market volatilities on IShares MSCI and NFO 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 NFO. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and NFO.

Diversification Opportunities for IShares MSCI and NFO

0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between IShares MSCI and NFO

If you would invest  8,959  in IShares MSCI ACWI on December 30, 2023 and sell it today you would earn a total of  2,054  from holding IShares MSCI ACWI or generate 22.93% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

IShares MSCI ACWI  vs.  NFO

 Performance 
       Timeline  
IShares MSCI ACWI 

Risk-Adjusted Performance

17 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in IShares MSCI ACWI are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, IShares MSCI may actually be approaching a critical reversion point that can send shares even higher in April 2024.
NFO 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days NFO has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, NFO is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

IShares MSCI and NFO Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IShares MSCI and NFO

The main advantage of trading using opposite IShares MSCI and NFO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, NFO 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 NFO will offset losses from the drop in NFO's long position.
The idea behind IShares MSCI ACWI and NFO 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

Other Complementary Tools

Global Correlations
Find global opportunities by holding instruments from different markets
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
AI Investment Finder
Use AI to screen and filter profitable investment opportunities
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Fundamental Analysis
View fundamental data based on most recent published financial statements
Sectors
List of equity sectors categorizing publicly traded companies based on their primary business activities