Correlation Between HSBC MSCI and Multi Units

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

By analyzing existing cross correlation between HSBC MSCI USA and Multi Units Luxembourg, you can compare the effects of market volatilities on HSBC MSCI and Multi Units 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 HSBC MSCI with a short position of Multi Units. Check out your portfolio center. Please also check ongoing floating volatility patterns of HSBC MSCI and Multi Units.

Diversification Opportunities for HSBC MSCI and Multi Units

0.0

Correlation Coefficient

HSBC MSCI  Multi Units

Pay attention - limited upside

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

Pair Corralation between HSBC MSCI and Multi Units

If you would invest  124,400  in Multi Units Luxembourg on April 24, 2025 and sell it today you would earn a total of  1,430  from holding Multi Units Luxembourg or generate 1.15% return on investment over 90 days.

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

HSBC MSCI USA  vs.  Multi Units Luxembourg

HSBC MSCI USA

Risk-Adjusted Performance

Solid

Over the last 90 days HSBC MSCI USA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, HSBC MSCI is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Multi Units Luxembourg

Risk-Adjusted Performance

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in Multi Units Luxembourg are ranked lower than 53 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Multi Units is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with HSBC MSCI and Multi Units

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

The idea behind HSBC MSCI USA and Multi Units Luxembourg 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.