Correlation Between Brainsway and Multi Retail
Can any of the company-specific risk be diversified away by investing in both Brainsway and Multi Retail 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 Brainsway and Multi Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brainsway and Multi Retail Group, you can compare the effects of market volatilities on Brainsway and Multi Retail 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 Brainsway with a short position of Multi Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brainsway and Multi Retail.
Diversification Opportunities for Brainsway and Multi Retail
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Brainsway and Multi is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Brainsway and Multi Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Retail Group and Brainsway 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 Brainsway are associated (or correlated) with Multi Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Retail Group has no effect on the direction of Brainsway i.e., Brainsway and Multi Retail go up and down completely randomly.
Pair Corralation between Brainsway and Multi Retail
Assuming the 90 days trading horizon Brainsway is expected to under-perform the Multi Retail. In addition to that, Brainsway is 1.1 times more volatile than Multi Retail Group. It trades about -0.04 of its total potential returns per unit of risk. Multi Retail Group is currently generating about 0.13 per unit of volatility. If you would invest 101,300 in Multi Retail Group on August 29, 2024 and sell it today you would earn a total of 6,400 from holding Multi Retail Group or generate 6.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brainsway vs. Multi Retail Group
Performance |
| Timeline |
| Brainsway |
| Multi Retail Group |
Brainsway and Multi Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brainsway and Multi Retail
The main advantage of trading using opposite Brainsway and Multi Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brainsway position performs unexpectedly, Multi Retail 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 Multi Retail will offset losses from the drop in Multi Retail's long position.| Brainsway vs. Ilex Medical | Brainsway vs. First International Bank | Brainsway vs. Elbit Medical Technologies | Brainsway vs. RSL Electronics |
| Multi Retail vs. Opal Balance | Multi Retail vs. B Communications | Multi Retail vs. Holmes Place International | Multi Retail vs. Nova |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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