Correlation Between Musti Group and Japan Post
Can any of the company-specific risk be diversified away by investing in both Musti Group and Japan Post 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 Musti Group and Japan Post into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Musti Group Oyj and Japan Post Insurance, you can compare the effects of market volatilities on Musti Group and Japan Post 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 Musti Group with a short position of Japan Post. Check out your portfolio center. Please also check ongoing floating volatility patterns of Musti Group and Japan Post.
Diversification Opportunities for Musti Group and Japan Post
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Musti and Japan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Musti Group Oyj and Japan Post Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Post Insurance and Musti 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 Musti Group Oyj are associated (or correlated) with Japan Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Post Insurance has no effect on the direction of Musti Group i.e., Musti Group and Japan Post go up and down completely randomly.
Pair Corralation between Musti Group and Japan Post
Assuming the 90 days horizon Musti Group Oyj is expected to under-perform the Japan Post. But the stock apears to be less risky and, when comparing its historical volatility, Musti Group Oyj is 1.29 times less risky than Japan Post. The stock trades about -0.02 of its potential returns per unit of risk. The Japan Post Insurance is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,850 in Japan Post Insurance on December 4, 2024 and sell it today you would earn a total of 20.00 from holding Japan Post Insurance or generate 1.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Musti Group Oyj vs. Japan Post Insurance
Performance |
| Timeline |
| Musti Group Oyj |
| Japan Post Insurance |
Musti Group and Japan Post Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Musti Group and Japan Post
The main advantage of trading using opposite Musti Group and Japan Post positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Musti Group position performs unexpectedly, Japan Post 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 Japan Post will offset losses from the drop in Japan Post's long position.| Musti Group vs. Service International | Musti Group vs. Bright Horizons Family | Musti Group vs. BOYD GROUP SERVICES | Musti Group vs. Frontdoor |
| Japan Post vs. Grand Canyon Education | Japan Post vs. EMBARK EDUCATION LTD | Japan Post vs. CanSino Biologics | Japan Post vs. EBRO FOODS |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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