Correlation Between Harbor ETF and Morgan Stanley

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

By analyzing existing cross correlation between Harbor ETF Trust and Morgan Stanley Pathway, you can compare the effects of market volatilities on Harbor ETF and Morgan Stanley 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 Harbor ETF with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbor ETF and Morgan Stanley.

Diversification Opportunities for Harbor ETF and Morgan Stanley

0.74

Correlation Coefficient

Harbor ETF  Morgan Stanley

Poor diversification

The 3 months correlation between Harbor and Morgan is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Harbor ETF Trust and Morgan Stanley Pathway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley Pathway and Harbor ETF 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 Harbor ETF Trust are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley Pathway has no effect on the direction of Harbor ETF i.e., Harbor ETF and Morgan Stanley go up and down completely randomly.

Pair Corralation between Harbor ETF and Morgan Stanley

Given the investment horizon of 90 days Harbor ETF is expected to generate 2.79 times less return on investment than Morgan Stanley. But when comparing it to its historical volatility, Harbor ETF Trust is 1.12 times less risky than Morgan Stanley. It trades about 0.05 of its potential returns per unit of risk. Morgan Stanley Pathway is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  4,752  in Morgan Stanley Pathway on August 4, 2025 and sell it today you would earn a total of  395.00  from holding Morgan Stanley Pathway or generate 8.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Harbor ETF Trust  vs.  Morgan Stanley Pathway

Harbor ETF Trust

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Harbor ETF Trust are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Harbor ETF is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Morgan Stanley Pathway

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Morgan Stanley Pathway are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Morgan Stanley may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Pair Trading with Harbor ETF and Morgan Stanley

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

The idea behind Harbor ETF Trust and Morgan Stanley Pathway 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.