Correlation Between First Trust and HFXJ
Can any of the company-specific risk be diversified away by investing in both First Trust and HFXJ 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 First Trust and HFXJ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Japan and HFXJ, you can compare the effects of market volatilities on First Trust and HFXJ 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 First Trust with a short position of HFXJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and HFXJ.
Diversification Opportunities for First Trust and HFXJ
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and HFXJ is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Japan and HFXJ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HFXJ and First Trust 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 First Trust Japan are associated (or correlated) with HFXJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HFXJ has no effect on the direction of First Trust i.e., First Trust and HFXJ go up and down completely randomly.
Pair Corralation between First Trust and HFXJ
If you would invest 4,405 in First Trust Japan on January 19, 2024 and sell it today you would earn a total of 830.00 from holding First Trust Japan or generate 18.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
First Trust Japan vs. HFXJ
Performance |
| Timeline |
| First Trust Japan |
| HFXJ |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
First Trust and HFXJ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and HFXJ
The main advantage of trading using opposite First Trust and HFXJ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, HFXJ 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 HFXJ will offset losses from the drop in HFXJ's long position.| First Trust vs. iShares MSCI South | First Trust vs. iShares MSCI Hong | First Trust vs. iShares MSCI Taiwan | First Trust vs. iShares MSCI Germany |
| HFXJ vs. iShares MSCI South | HFXJ vs. iShares MSCI Hong | HFXJ vs. iShares MSCI Taiwan | HFXJ vs. iShares MSCI Germany |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |