Correlation Between MYFAIR GOLD and SPARTAN STORES
Can any of the company-specific risk be diversified away by investing in both MYFAIR GOLD and SPARTAN STORES 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 MYFAIR GOLD and SPARTAN STORES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MYFAIR GOLD P and SPARTAN STORES, you can compare the effects of market volatilities on MYFAIR GOLD and SPARTAN STORES 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 MYFAIR GOLD with a short position of SPARTAN STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYFAIR GOLD and SPARTAN STORES.
Diversification Opportunities for MYFAIR GOLD and SPARTAN STORES
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between MYFAIR and SPARTAN is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding MYFAIR GOLD P and SPARTAN STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPARTAN STORES and MYFAIR GOLD 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 MYFAIR GOLD P are associated (or correlated) with SPARTAN STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPARTAN STORES has no effect on the direction of MYFAIR GOLD i.e., MYFAIR GOLD and SPARTAN STORES go up and down completely randomly.
Pair Corralation between MYFAIR GOLD and SPARTAN STORES
Assuming the 90 days horizon MYFAIR GOLD P is expected to generate 1.56 times more return on investment than SPARTAN STORES. However, MYFAIR GOLD is 1.56 times more volatile than SPARTAN STORES. It trades about 0.01 of its potential returns per unit of risk. SPARTAN STORES is currently generating about -0.01 per unit of risk. If you would invest 126.00 in MYFAIR GOLD P on August 27, 2024 and sell it today you would earn a total of 0.00 from holding MYFAIR GOLD P or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MYFAIR GOLD P vs. SPARTAN STORES
Performance |
| Timeline |
| MYFAIR GOLD P |
| SPARTAN STORES |
MYFAIR GOLD and SPARTAN STORES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MYFAIR GOLD and SPARTAN STORES
The main advantage of trading using opposite MYFAIR GOLD and SPARTAN STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MYFAIR GOLD position performs unexpectedly, SPARTAN STORES 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 SPARTAN STORES will offset losses from the drop in SPARTAN STORES's long position.| MYFAIR GOLD vs. Franco Nevada | MYFAIR GOLD vs. Agnico Eagle Mines | MYFAIR GOLD vs. Superior Plus Corp | MYFAIR GOLD vs. NMI Holdings |
| SPARTAN STORES vs. Quaker Chemical | SPARTAN STORES vs. MYFAIR GOLD P | SPARTAN STORES vs. Mitsui Chemicals | SPARTAN STORES vs. AIR PRODCHEMICALS |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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