Correlation Between Acco Brands and Mannatech Incorporated
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Mannatech Incorporated 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 Acco Brands and Mannatech Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Mannatech Incorporated, you can compare the effects of market volatilities on Acco Brands and Mannatech Incorporated 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 Acco Brands with a short position of Mannatech Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Mannatech Incorporated.
Diversification Opportunities for Acco Brands and Mannatech Incorporated
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Acco and Mannatech is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Mannatech Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mannatech Incorporated and Acco Brands 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 Acco Brands are associated (or correlated) with Mannatech Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mannatech Incorporated has no effect on the direction of Acco Brands i.e., Acco Brands and Mannatech Incorporated go up and down completely randomly.
Pair Corralation between Acco Brands and Mannatech Incorporated
Given the investment horizon of 90 days Acco Brands is expected to generate 0.62 times more return on investment than Mannatech Incorporated. However, Acco Brands is 1.61 times less risky than Mannatech Incorporated. It trades about 0.28 of its potential returns per unit of risk. Mannatech Incorporated is currently generating about -0.01 per unit of risk. If you would invest 491.00 in Acco Brands on August 31, 2024 and sell it today you would earn a total of 90.00 from holding Acco Brands or generate 18.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Acco Brands vs. Mannatech Incorporated
Performance |
| Timeline |
| Acco Brands |
| Mannatech Incorporated |
Acco Brands and Mannatech Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Mannatech Incorporated
The main advantage of trading using opposite Acco Brands and Mannatech Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Mannatech Incorporated 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 Mannatech Incorporated will offset losses from the drop in Mannatech Incorporated's long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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