Correlation Between Materialise and Genesco
Can any of the company-specific risk be diversified away by investing in both Materialise and Genesco 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 Materialise and Genesco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Materialise NV and Genesco, you can compare the effects of market volatilities on Materialise and Genesco 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 Materialise with a short position of Genesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materialise and Genesco.
Diversification Opportunities for Materialise and Genesco
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Materialise and Genesco is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Materialise NV and Genesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesco and Materialise 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 Materialise NV are associated (or correlated) with Genesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesco has no effect on the direction of Materialise i.e., Materialise and Genesco go up and down completely randomly.
Pair Corralation between Materialise and Genesco
Assuming the 90 days trading horizon Materialise is expected to generate 2.56 times less return on investment than Genesco. In addition to that, Materialise is 1.18 times more volatile than Genesco. It trades about 0.01 of its total potential returns per unit of risk. Genesco is currently generating about 0.02 per unit of volatility. If you would invest 2,800 in Genesco on December 11, 2024 and sell it today you would earn a total of 160.00 from holding Genesco or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Materialise NV vs. Genesco
Performance |
| Timeline |
| Materialise NV |
| Genesco |
Materialise and Genesco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Materialise and Genesco
The main advantage of trading using opposite Materialise and Genesco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materialise position performs unexpectedly, Genesco 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 Genesco will offset losses from the drop in Genesco's long position.| Materialise vs. United Rentals | ||
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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