Correlation Between Alfa Financial and MTY Food
Can any of the company-specific risk be diversified away by investing in both Alfa Financial and MTY Food 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 Alfa Financial and MTY Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Financial Software and MTY Food Group, you can compare the effects of market volatilities on Alfa Financial and MTY Food 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 Alfa Financial with a short position of MTY Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and MTY Food.
Diversification Opportunities for Alfa Financial and MTY Food
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alfa and MTY is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and MTY Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTY Food Group and Alfa 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 Alfa Financial Software are associated (or correlated) with MTY Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTY Food Group has no effect on the direction of Alfa Financial i.e., Alfa Financial and MTY Food go up and down completely randomly.
Pair Corralation between Alfa Financial and MTY Food
Assuming the 90 days trading horizon Alfa Financial Software is expected to under-perform the MTY Food. In addition to that, Alfa Financial is 1.3 times more volatile than MTY Food Group. It trades about -0.17 of its total potential returns per unit of risk. MTY Food Group is currently generating about -0.03 per unit of volatility. If you would invest 3,120 in MTY Food Group on October 19, 2024 and sell it today you would lose (75.00) from holding MTY Food Group or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alfa Financial Software vs. MTY Food Group
Performance |
| Timeline |
| Alfa Financial Software |
| MTY Food Group |
Alfa Financial and MTY Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfa Financial and MTY Food
The main advantage of trading using opposite Alfa Financial and MTY Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Financial position performs unexpectedly, MTY Food 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 MTY Food will offset losses from the drop in MTY Food's long position.| Alfa Financial vs. YOOMA WELLNESS INC | Alfa Financial vs. PT Wintermar Offshore | Alfa Financial vs. COPLAND ROAD CAPITAL | Alfa Financial vs. BW OFFSHORE LTD |
| MTY Food vs. CARSALESCOM | MTY Food vs. Thai Beverage Public | MTY Food vs. China Resources Beer | MTY Food vs. INTER CARS SA |
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 CEOs Directory module to screen CEOs from public companies around the world.
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