Correlation Between IShares MSCI and Pacer Lunt
Can any of the company-specific risk be diversified away by investing in both IShares MSCI and Pacer Lunt 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 Pacer Lunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares MSCI Malaysia and Pacer Lunt Large, you can compare the effects of market volatilities on IShares MSCI and Pacer Lunt 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 Pacer Lunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares MSCI and Pacer Lunt.
Diversification Opportunities for IShares MSCI and Pacer Lunt
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between IShares and Pacer is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding iShares MSCI Malaysia and Pacer Lunt Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Lunt Large 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 Malaysia are associated (or correlated) with Pacer Lunt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Lunt Large has no effect on the direction of IShares MSCI i.e., IShares MSCI and Pacer Lunt go up and down completely randomly.
Pair Corralation between IShares MSCI and Pacer Lunt
Considering the 90-day investment horizon iShares MSCI Malaysia is expected to generate 1.07 times more return on investment than Pacer Lunt. However, IShares MSCI is 1.07 times more volatile than Pacer Lunt Large. It trades about 0.14 of its potential returns per unit of risk. Pacer Lunt Large is currently generating about 0.05 per unit of risk. If you would invest 2,473 in iShares MSCI Malaysia on August 31, 2025 and sell it today you would earn a total of 170.00 from holding iShares MSCI Malaysia or generate 6.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares MSCI Malaysia vs. Pacer Lunt Large
Performance |
| Timeline |
| iShares MSCI Malaysia |
| Pacer Lunt Large |
IShares MSCI and Pacer Lunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares MSCI and Pacer Lunt
The main advantage of trading using opposite IShares MSCI and Pacer Lunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares MSCI position performs unexpectedly, Pacer Lunt 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 Pacer Lunt will offset losses from the drop in Pacer Lunt's long position.| IShares MSCI vs. Strategy Shares | IShares MSCI vs. Freedom Day Dividend | IShares MSCI vs. Franklin Templeton ETF | IShares MSCI vs. iShares MSCI China |
| Pacer Lunt vs. FT Vest Equity | Pacer Lunt vs. Northern Lights | Pacer Lunt vs. Diamond Hill Funds | Pacer Lunt vs. Dimensional International High |
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 Stocks Directory module to find actively traded stocks across global markets.
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