Correlation Between Apartment Investment and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both Apartment Investment and Marfrig Global 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 Apartment Investment and Marfrig Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apartment Investment and and Marfrig Global Foods, you can compare the effects of market volatilities on Apartment Investment and Marfrig Global 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 Apartment Investment with a short position of Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apartment Investment and Marfrig Global.
Diversification Opportunities for Apartment Investment and Marfrig Global
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Apartment and Marfrig is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Apartment Investment and and Marfrig Global Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfrig Global Foods and Apartment Investment 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 Apartment Investment and are associated (or correlated) with Marfrig Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfrig Global Foods has no effect on the direction of Apartment Investment i.e., Apartment Investment and Marfrig Global go up and down completely randomly.
Pair Corralation between Apartment Investment and Marfrig Global
Assuming the 90 days trading horizon Apartment Investment is expected to generate 37.13 times less return on investment than Marfrig Global. But when comparing it to its historical volatility, Apartment Investment and is 1.44 times less risky than Marfrig Global. It trades about 0.02 of its potential returns per unit of risk. Marfrig Global Foods is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 1,476 in Marfrig Global Foods on August 28, 2024 and sell it today you would earn a total of 360.00 from holding Marfrig Global Foods or generate 24.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apartment Investment and vs. Marfrig Global Foods
Performance |
| Timeline |
| Apartment Investment and |
| Marfrig Global Foods |
Apartment Investment and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apartment Investment and Marfrig Global
The main advantage of trading using opposite Apartment Investment and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apartment Investment position performs unexpectedly, Marfrig Global 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 Marfrig Global will offset losses from the drop in Marfrig Global's long position.| Apartment Investment vs. Fras le SA | Apartment Investment vs. Clave Indices De | Apartment Investment vs. BTG Pactual Logstica | Apartment Investment vs. Telefonaktiebolaget LM Ericsson |
| Marfrig Global vs. Minerva SA | Marfrig Global vs. Companhia Siderrgica Nacional | Marfrig Global vs. Cyrela Brazil Realty |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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