Correlation Between Brunswick Corp and Micromobility
Can any of the company-specific risk be diversified away by investing in both Brunswick Corp and Micromobility 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 Brunswick Corp and Micromobility into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brunswick Corp and Micromobility, you can compare the effects of market volatilities on Brunswick Corp and Micromobility 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 Brunswick Corp with a short position of Micromobility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brunswick Corp and Micromobility.
Diversification Opportunities for Brunswick Corp and Micromobility
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Brunswick and Micromobility is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Brunswick Corp and Micromobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micromobility and Brunswick Corp 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 Brunswick Corp are associated (or correlated) with Micromobility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Micromobility has no effect on the direction of Brunswick Corp i.e., Brunswick Corp and Micromobility go up and down completely randomly.
Pair Corralation between Brunswick Corp and Micromobility
Assuming the 90 days horizon Brunswick Corp is expected to generate 0.07 times more return on investment than Micromobility. However, Brunswick Corp is 13.5 times less risky than Micromobility. It trades about 0.03 of its potential returns per unit of risk. Micromobility is currently generating about -0.17 per unit of risk. If you would invest 2,138 in Brunswick Corp on August 28, 2024 and sell it today you would earn a total of 328.00 from holding Brunswick Corp or generate 15.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 31.72% |
| Values | Daily Returns |
Brunswick Corp vs. Micromobility
Performance |
| Timeline |
| Brunswick Corp |
| Micromobility |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Brunswick Corp and Micromobility Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brunswick Corp and Micromobility
The main advantage of trading using opposite Brunswick Corp and Micromobility positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brunswick Corp position performs unexpectedly, Micromobility 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 Micromobility will offset losses from the drop in Micromobility's long position.The idea behind Brunswick Corp and Micromobility pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Micromobility vs. Emerson Radio | Micromobility vs. 51Talk Online Education | Micromobility vs. Valneva SE ADR | Micromobility vs. Apogee Therapeutics, Common |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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