Correlation Between Mliuz SA and Bath Body
Can any of the company-specific risk be diversified away by investing in both Mliuz SA and Bath Body 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 Mliuz SA and Bath Body into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mliuz SA and Bath Body Works, you can compare the effects of market volatilities on Mliuz SA and Bath Body 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 Mliuz SA with a short position of Bath Body. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mliuz SA and Bath Body.
Diversification Opportunities for Mliuz SA and Bath Body
Excellent diversification
The 3 months correlation between Mliuz and Bath is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Mliuz SA and Bath Body Works in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bath Body Works and Mliuz SA 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 Mliuz SA are associated (or correlated) with Bath Body. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bath Body Works has no effect on the direction of Mliuz SA i.e., Mliuz SA and Bath Body go up and down completely randomly.
Pair Corralation between Mliuz SA and Bath Body
Assuming the 90 days trading horizon Mliuz SA is expected to generate 2.24 times more return on investment than Bath Body. However, Mliuz SA is 2.24 times more volatile than Bath Body Works. It trades about 0.03 of its potential returns per unit of risk. Bath Body Works is currently generating about 0.02 per unit of risk. If you would invest 325.00 in Mliuz SA on September 14, 2024 and sell it today you would lose (30.00) from holding Mliuz SA or give up 9.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 56.25% |
| Values | Daily Returns |
Mliuz SA vs. Bath Body Works
Performance |
| Timeline |
| Mliuz SA |
| Bath Body Works |
Mliuz SA and Bath Body Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mliuz SA and Bath Body
The main advantage of trading using opposite Mliuz SA and Bath Body positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mliuz SA position performs unexpectedly, Bath Body 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 Bath Body will offset losses from the drop in Bath Body's long position.The idea behind Mliuz SA and Bath Body Works 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.| Bath Body vs. Mliuz SA | Bath Body vs. Natura Co Holding | Bath Body vs. Rede DOr So | Bath Body vs. Locaweb Servios de |
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 CEOs Directory module to screen CEOs from public companies around the world.
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