Correlation Between Anglo American and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both Anglo American 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 Anglo American and Marfrig Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anglo American Platinum and Marfrig Global Foods, you can compare the effects of market volatilities on Anglo American 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 Anglo American with a short position of Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anglo American and Marfrig Global.
Diversification Opportunities for Anglo American and Marfrig Global
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Anglo and Marfrig is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Anglo American Platinum 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 Anglo American 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 Anglo American Platinum 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 Anglo American i.e., Anglo American and Marfrig Global go up and down completely randomly.
Pair Corralation between Anglo American and Marfrig Global
Assuming the 90 days horizon Anglo American Platinum is expected to generate 2.03 times more return on investment than Marfrig Global. However, Anglo American is 2.03 times more volatile than Marfrig Global Foods. It trades about 0.23 of its potential returns per unit of risk. Marfrig Global Foods is currently generating about 0.04 per unit of risk. If you would invest 2,942 in Anglo American Platinum on November 4, 2024 and sell it today you would earn a total of 727.00 from holding Anglo American Platinum or generate 24.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anglo American Platinum vs. Marfrig Global Foods
Performance |
| Timeline |
| Anglo American Platinum |
| Marfrig Global Foods |
Anglo American and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anglo American and Marfrig Global
The main advantage of trading using opposite Anglo American and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anglo American 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.| Anglo American vs. Diageo PLC ADR | Anglo American vs. Playa Hotels Resorts | Anglo American vs. Sable Offshore Corp | Anglo American vs. Vita Coco |
| Marfrig Global vs. BRF SA ADR | Marfrig Global vs. Pilgrims Pride Corp | Marfrig Global vs. John B Sanfilippo | Marfrig Global vs. Seneca Foods Corp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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