Correlation Between MidCap Financial and Sixt Leasing
Can any of the company-specific risk be diversified away by investing in both MidCap Financial and Sixt Leasing 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 MidCap Financial and Sixt Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MidCap Financial Investment and Sixt Leasing SE, you can compare the effects of market volatilities on MidCap Financial and Sixt Leasing 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 MidCap Financial with a short position of Sixt Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of MidCap Financial and Sixt Leasing.
Diversification Opportunities for MidCap Financial and Sixt Leasing
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MidCap and Sixt is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding MidCap Financial Investment and Sixt Leasing SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt Leasing SE and MidCap Financial 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 MidCap Financial Investment are associated (or correlated) with Sixt Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt Leasing SE has no effect on the direction of MidCap Financial i.e., MidCap Financial and Sixt Leasing go up and down completely randomly.
Pair Corralation between MidCap Financial and Sixt Leasing
Assuming the 90 days trading horizon MidCap Financial Investment is expected to generate 0.68 times more return on investment than Sixt Leasing. However, MidCap Financial Investment is 1.47 times less risky than Sixt Leasing. It trades about -0.04 of its potential returns per unit of risk. Sixt Leasing SE is currently generating about -0.19 per unit of risk. If you would invest 1,287 in MidCap Financial Investment on October 11, 2024 and sell it today you would lose (10.00) from holding MidCap Financial Investment or give up 0.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MidCap Financial Investment vs. Sixt Leasing SE
Performance |
| Timeline |
| MidCap Financial Inv |
| Sixt Leasing SE |
MidCap Financial and Sixt Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MidCap Financial and Sixt Leasing
The main advantage of trading using opposite MidCap Financial and Sixt Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MidCap Financial position performs unexpectedly, Sixt Leasing 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 Sixt Leasing will offset losses from the drop in Sixt Leasing's long position.| MidCap Financial vs. Southwest Airlines Co | MidCap Financial vs. Singapore Airlines Limited | MidCap Financial vs. GRENKELEASING Dusseldorf | MidCap Financial vs. JAPAN AIRLINES |
| Sixt Leasing vs. SYSTEMAIR AB | Sixt Leasing vs. Entravision Communications | Sixt Leasing vs. FORWARD AIR P | Sixt Leasing vs. Cogent Communications Holdings |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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