Correlation Between International Equities and Profunds Money

Can any of the company-specific risk be diversified away by investing in both International Equities and Profunds Money 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 International Equities and Profunds Money into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between International Equities Index and Profunds Money, you can compare the effects of market volatilities on International Equities and Profunds Money 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 International Equities with a short position of Profunds Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Equities and Profunds Money.

Diversification Opportunities for International Equities and Profunds Money

0.0

Correlation Coefficient

International Equities  Profunds Money

Pay attention - limited upside

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

Pair Corralation between International Equities and Profunds Money

If you would invest  874.00  in International Equities Index on May 6, 2025 and sell it today you would earn a total of  27.00  from holding International Equities Index or generate 3.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	54.84%
Values	Daily Returns

International Equities Index  vs.  Profunds Money

International Equities

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in International Equities Index are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, International Equities is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Profunds Money

Risk-Adjusted Performance

Very Weak

Over the last 90 days Profunds Money has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Profunds Money is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with International Equities and Profunds Money

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

The idea behind International Equities Index and Profunds Money 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .