Correlation Between MOVIE GAMES and MIE HOLDINGS
Can any of the company-specific risk be diversified away by investing in both MOVIE GAMES and MIE HOLDINGS 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 MOVIE GAMES and MIE HOLDINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOVIE GAMES SA and MIE HOLDINGS, you can compare the effects of market volatilities on MOVIE GAMES and MIE HOLDINGS 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 MOVIE GAMES with a short position of MIE HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOVIE GAMES and MIE HOLDINGS.
Diversification Opportunities for MOVIE GAMES and MIE HOLDINGS
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between MOVIE and MIE is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and MIE HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MIE HOLDINGS and MOVIE GAMES 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 MOVIE GAMES SA are associated (or correlated) with MIE HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MIE HOLDINGS has no effect on the direction of MOVIE GAMES i.e., MOVIE GAMES and MIE HOLDINGS go up and down completely randomly.
Pair Corralation between MOVIE GAMES and MIE HOLDINGS
Assuming the 90 days horizon MOVIE GAMES SA is expected to under-perform the MIE HOLDINGS. But the stock apears to be less risky and, when comparing its historical volatility, MOVIE GAMES SA is 12.57 times less risky than MIE HOLDINGS. The stock trades about -0.12 of its potential returns per unit of risk. The MIE HOLDINGS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.15 in MIE HOLDINGS on September 3, 2024 and sell it today you would lose (0.10) from holding MIE HOLDINGS or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOVIE GAMES SA vs. MIE HOLDINGS
Performance |
| Timeline |
| MOVIE GAMES SA |
| MIE HOLDINGS |
MOVIE GAMES and MIE HOLDINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOVIE GAMES and MIE HOLDINGS
The main advantage of trading using opposite MOVIE GAMES and MIE HOLDINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES position performs unexpectedly, MIE HOLDINGS 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 MIE HOLDINGS will offset losses from the drop in MIE HOLDINGS's long position.| MOVIE GAMES vs. LION ONE METALS | MOVIE GAMES vs. Silicon Motion Technology | MOVIE GAMES vs. Perseus Mining Limited | MOVIE GAMES vs. China BlueChemical |
| MIE HOLDINGS vs. Goodyear Tire Rubber | MIE HOLDINGS vs. Applied Materials | MIE HOLDINGS vs. Perseus Mining Limited | MIE HOLDINGS vs. GOODYEAR T RUBBER |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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