Correlation Between MTY Food and Garofalo Health
Can any of the company-specific risk be diversified away by investing in both MTY Food and Garofalo Health 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 Garofalo Health 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 Garofalo Health Care, you can compare the effects of market volatilities on MTY Food and Garofalo Health 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 Garofalo Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and Garofalo Health.
Diversification Opportunities for MTY Food and Garofalo Health
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between MTY and Garofalo is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and Garofalo Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garofalo Health Care 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 Garofalo Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garofalo Health Care has no effect on the direction of MTY Food i.e., MTY Food and Garofalo Health go up and down completely randomly.
Pair Corralation between MTY Food and Garofalo Health
Assuming the 90 days horizon MTY Food Group is expected to generate 0.95 times more return on investment than Garofalo Health. However, MTY Food Group is 1.06 times less risky than Garofalo Health. It trades about -0.22 of its potential returns per unit of risk. Garofalo Health Care is currently generating about -0.21 per unit of risk. If you would invest 3,230 in MTY Food Group on October 13, 2024 and sell it today you would lose (160.00) from holding MTY Food Group or give up 4.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MTY Food Group vs. Garofalo Health Care
Performance |
| Timeline |
| MTY Food Group |
| Garofalo Health Care |
MTY Food and Garofalo Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MTY Food and Garofalo Health
The main advantage of trading using opposite MTY Food and Garofalo Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, Garofalo Health 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 Garofalo Health will offset losses from the drop in Garofalo Health's long position.| MTY Food vs. Superior Plus Corp | MTY Food vs. NMI Holdings | MTY Food vs. SIVERS SEMICONDUCTORS AB | MTY Food vs. Talanx AG |
| Garofalo Health vs. MTY Food Group | Garofalo Health vs. PLANT VEDA FOODS | Garofalo Health vs. AWILCO DRILLING PLC | Garofalo Health vs. INDOFOOD AGRI RES |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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