Correlation Between MTY Food and Nomad Foods
Can any of the company-specific risk be diversified away by investing in both MTY Food and Nomad Foods 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 MTY Food and Nomad Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MTY Food Group and Nomad Foods, you can compare the effects of market volatilities on MTY Food and Nomad Foods 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 MTY Food with a short position of Nomad Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and Nomad Foods.
Diversification Opportunities for MTY Food and Nomad Foods
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MTY and Nomad is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and Nomad Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nomad Foods and MTY Food 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 MTY Food Group are associated (or correlated) with Nomad Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nomad Foods has no effect on the direction of MTY Food i.e., MTY Food and Nomad Foods go up and down completely randomly.
Pair Corralation between MTY Food and Nomad Foods
Assuming the 90 days horizon MTY Food Group is expected to generate 0.99 times more return on investment than Nomad Foods. However, MTY Food Group is 1.01 times less risky than Nomad Foods. It trades about 0.04 of its potential returns per unit of risk. Nomad Foods is currently generating about -0.02 per unit of risk. If you would invest 2,972 in MTY Food Group on October 14, 2024 and sell it today you would earn a total of 98.00 from holding MTY Food Group or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MTY Food Group vs. Nomad Foods
Performance |
| Timeline |
| MTY Food Group |
| Nomad Foods |
MTY Food and Nomad Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MTY Food and Nomad Foods
The main advantage of trading using opposite MTY Food and Nomad Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, Nomad Foods 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 Nomad Foods will offset losses from the drop in Nomad Foods' long position.| MTY Food vs. Superior Plus Corp | MTY Food vs. NMI Holdings | MTY Food vs. SIVERS SEMICONDUCTORS AB | MTY Food vs. Talanx AG |
| Nomad Foods vs. National Beverage Corp | Nomad Foods vs. Tencent Music Entertainment | Nomad Foods vs. SENECA FOODS A | Nomad Foods vs. MTY Food Group |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |