Is it possible to host multiple instances of xConnect collection in different regions? We have 2 CD instances that are hosted in different regions and would like to have a xConnect collection hosted in the same region as CD for better performance.
Yes, you can have have multiple instances across multiple regions. But you need to factor in that you can only have 1 xConnect SOLR core and 1 Sitecore Processing Engine service. This means that one xConnect will likely have direct access to SOLR queries and another (remote) will have to talk to SOLR over a WAN.
Please refer to this scaling doc from Sitecore.