Correlation Between Boxed and MercadoLibre
Can any of the company-specific risk be diversified away by investing in both Boxed and MercadoLibre 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 Boxed and MercadoLibre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boxed Inc and MercadoLibre, you can compare the effects of market volatilities on Boxed and MercadoLibre 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 Boxed with a short position of MercadoLibre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boxed and MercadoLibre.
Diversification Opportunities for Boxed and MercadoLibre
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Boxed and MercadoLibre is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Boxed Inc and MercadoLibre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MercadoLibre and Boxed 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 Boxed Inc are associated (or correlated) with MercadoLibre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MercadoLibre has no effect on the direction of Boxed i.e., Boxed and MercadoLibre go up and down completely randomly.
Pair Corralation between Boxed and MercadoLibre
If you would invest 205,609 in MercadoLibre on August 29, 2024 and sell it today you would earn a total of 5,391 from holding MercadoLibre or generate 2.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Boxed Inc vs. MercadoLibre
Performance |
| Timeline |
| Boxed Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MercadoLibre |
Boxed and MercadoLibre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boxed and MercadoLibre
The main advantage of trading using opposite Boxed and MercadoLibre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boxed position performs unexpectedly, MercadoLibre 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 MercadoLibre will offset losses from the drop in MercadoLibre's long position.| Boxed vs. Assurant | Boxed vs. Sun Life Financial | Boxed vs. Aegon NV ADR | Boxed vs. CF Industries Holdings |
| MercadoLibre vs. PDD Holdings | MercadoLibre vs. JD Inc Adr | MercadoLibre vs. Alibaba Group Holding | MercadoLibre vs. Global E Online |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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