Correlation Between St Galler and Morgan Sindall
Can any of the company-specific risk be diversified away by investing in both St Galler and Morgan Sindall 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 St Galler and Morgan Sindall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between St Galler Kantonalbank and Morgan Sindall Group, you can compare the effects of market volatilities on St Galler and Morgan Sindall 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 St Galler with a short position of Morgan Sindall. Check out your portfolio center. Please also check ongoing floating volatility patterns of St Galler and Morgan Sindall.
Diversification Opportunities for St Galler and Morgan Sindall
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between 0QQZ and Morgan is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding St Galler Kantonalbank and Morgan Sindall Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Sindall Group and St Galler 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 St Galler Kantonalbank are associated (or correlated) with Morgan Sindall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Sindall Group has no effect on the direction of St Galler i.e., St Galler and Morgan Sindall go up and down completely randomly.
Pair Corralation between St Galler and Morgan Sindall
Assuming the 90 days trading horizon St Galler Kantonalbank is expected to generate 0.45 times more return on investment than Morgan Sindall. However, St Galler Kantonalbank is 2.24 times less risky than Morgan Sindall. It trades about 0.38 of its potential returns per unit of risk. Morgan Sindall Group is currently generating about -0.09 per unit of risk. If you would invest 42,850 in St Galler Kantonalbank on October 24, 2024 and sell it today you would earn a total of 2,450 from holding St Galler Kantonalbank or generate 5.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
St Galler Kantonalbank vs. Morgan Sindall Group
Performance |
| Timeline |
| St Galler Kantonalbank |
| Morgan Sindall Group |
St Galler and Morgan Sindall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with St Galler and Morgan Sindall
The main advantage of trading using opposite St Galler and Morgan Sindall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if St Galler position performs unexpectedly, Morgan Sindall 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 Sindall will offset losses from the drop in Morgan Sindall's long position.| St Galler vs. Sabre Insurance Group | St Galler vs. SMA Solar Technology | St Galler vs. Playtech Plc | St Galler vs. STMicroelectronics NV |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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