Correlation Between Cal-Bay Intl and MGT Capital
Can any of the company-specific risk be diversified away by investing in both Cal-Bay Intl and MGT Capital 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 Cal-Bay Intl and MGT Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cal Bay Intl and MGT Capital Investments, you can compare the effects of market volatilities on Cal-Bay Intl and MGT Capital 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 Cal-Bay Intl with a short position of MGT Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal-Bay Intl and MGT Capital.
Diversification Opportunities for Cal-Bay Intl and MGT Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cal-Bay and MGT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cal Bay Intl and MGT Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGT Capital Investments and Cal-Bay Intl 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 Cal Bay Intl are associated (or correlated) with MGT Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGT Capital Investments has no effect on the direction of Cal-Bay Intl i.e., Cal-Bay Intl and MGT Capital go up and down completely randomly.
Pair Corralation between Cal-Bay Intl and MGT Capital
Given the investment horizon of 90 days Cal Bay Intl is expected to generate 4.64 times more return on investment than MGT Capital. However, Cal-Bay Intl is 4.64 times more volatile than MGT Capital Investments. It trades about 0.1 of its potential returns per unit of risk. MGT Capital Investments is currently generating about 0.05 per unit of risk. If you would invest 0.03 in Cal Bay Intl on August 30, 2024 and sell it today you would lose (0.02) from holding Cal Bay Intl or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 31.11% |
| Values | Daily Returns |
Cal Bay Intl vs. MGT Capital Investments
Performance |
| Timeline |
| Cal Bay Intl |
| MGT Capital Investments |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cal-Bay Intl and MGT Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cal-Bay Intl and MGT Capital
The main advantage of trading using opposite Cal-Bay Intl and MGT Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal-Bay Intl position performs unexpectedly, MGT Capital 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 MGT Capital will offset losses from the drop in MGT Capital's long position.| Cal-Bay Intl vs. Boston Properties | Cal-Bay Intl vs. Kilroy Realty Corp | Cal-Bay Intl vs. SL Green Realty | Cal-Bay Intl vs. Vornado Realty Trust |
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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