Correlation Between SoftBank Group and Mynaric AG
Can any of the company-specific risk be diversified away by investing in both SoftBank Group and Mynaric AG 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 SoftBank Group and Mynaric AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoftBank Group Corp and Mynaric AG, you can compare the effects of market volatilities on SoftBank Group and Mynaric AG 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 SoftBank Group with a short position of Mynaric AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoftBank Group and Mynaric AG.
Diversification Opportunities for SoftBank Group and Mynaric AG
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SoftBank and Mynaric is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding SoftBank Group Corp and Mynaric AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mynaric AG and SoftBank Group 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 SoftBank Group Corp are associated (or correlated) with Mynaric AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mynaric AG has no effect on the direction of SoftBank Group i.e., SoftBank Group and Mynaric AG go up and down completely randomly.
Pair Corralation between SoftBank Group and Mynaric AG
Assuming the 90 days trading horizon SoftBank Group Corp is expected to generate 0.56 times more return on investment than Mynaric AG. However, SoftBank Group Corp is 1.8 times less risky than Mynaric AG. It trades about 0.05 of its potential returns per unit of risk. Mynaric AG is currently generating about -0.02 per unit of risk. If you would invest 609,105 in SoftBank Group Corp on September 2, 2024 and sell it today you would earn a total of 268,895 from holding SoftBank Group Corp or generate 44.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 81.6% |
| Values | Daily Returns |
SoftBank Group Corp vs. Mynaric AG
Performance |
| Timeline |
| SoftBank Group Corp |
| Mynaric AG |
SoftBank Group and Mynaric AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoftBank Group and Mynaric AG
The main advantage of trading using opposite SoftBank Group and Mynaric AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoftBank Group position performs unexpectedly, Mynaric AG 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 Mynaric AG will offset losses from the drop in Mynaric AG's long position.| SoftBank Group vs. Toyota Motor Corp | SoftBank Group vs. OTP Bank Nyrt | SoftBank Group vs. Las Vegas Sands | SoftBank Group vs. Yum Brands |
| Mynaric AG vs. Gamma Communications PLC | Mynaric AG vs. Smithson Investment Trust | Mynaric AG vs. Team Internet Group | Mynaric AG vs. Schroders Investment Trusts |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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