Correlation Between Mauna Kea and Avenir Telecom
Can any of the company-specific risk be diversified away by investing in both Mauna Kea and Avenir Telecom 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 Mauna Kea and Avenir Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mauna Kea Technologies and Avenir Telecom SA, you can compare the effects of market volatilities on Mauna Kea and Avenir Telecom 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 Mauna Kea with a short position of Avenir Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mauna Kea and Avenir Telecom.
Diversification Opportunities for Mauna Kea and Avenir Telecom
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mauna and Avenir is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Mauna Kea Technologies and Avenir Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avenir Telecom SA and Mauna Kea 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 Mauna Kea Technologies are associated (or correlated) with Avenir Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avenir Telecom SA has no effect on the direction of Mauna Kea i.e., Mauna Kea and Avenir Telecom go up and down completely randomly.
Pair Corralation between Mauna Kea and Avenir Telecom
Assuming the 90 days trading horizon Mauna Kea Technologies is expected to under-perform the Avenir Telecom. But the stock apears to be less risky and, when comparing its historical volatility, Mauna Kea Technologies is 1.76 times less risky than Avenir Telecom. The stock trades about -0.03 of its potential returns per unit of risk. The Avenir Telecom SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Avenir Telecom SA on August 29, 2024 and sell it today you would lose (4.69) from holding Avenir Telecom SA or give up 39.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mauna Kea Technologies vs. Avenir Telecom SA
Performance |
| Timeline |
| Mauna Kea Technologies |
| Avenir Telecom SA |
Mauna Kea and Avenir Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mauna Kea and Avenir Telecom
The main advantage of trading using opposite Mauna Kea and Avenir Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mauna Kea position performs unexpectedly, Avenir Telecom 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 Avenir Telecom will offset losses from the drop in Avenir Telecom's long position.| Mauna Kea vs. LVMH Mot Hennessy | Mauna Kea vs. LOreal SA | Mauna Kea vs. Hermes International SCA | Mauna Kea vs. Manitou BF SA |
| Avenir Telecom vs. ATEME SA | Avenir Telecom vs. Grolleau SAS | Avenir Telecom vs. Entech SE SAS | Avenir Telecom vs. Haffner Energy 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |