Correlation Between Centuria Capital and MFF Capital
Can any of the company-specific risk be diversified away by investing in both Centuria Capital and MFF 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 Centuria Capital and MFF Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centuria Capital and MFF Capital Investments, you can compare the effects of market volatilities on Centuria Capital and MFF 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 Centuria Capital with a short position of MFF Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centuria Capital and MFF Capital.
Diversification Opportunities for Centuria Capital and MFF Capital
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Centuria and MFF is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Centuria Capital and MFF Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFF Capital Investments and Centuria Capital 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 Centuria Capital are associated (or correlated) with MFF Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFF Capital Investments has no effect on the direction of Centuria Capital i.e., Centuria Capital and MFF Capital go up and down completely randomly.
Pair Corralation between Centuria Capital and MFF Capital
Assuming the 90 days trading horizon Centuria Capital is expected to generate 2.11 times less return on investment than MFF Capital. In addition to that, Centuria Capital is 2.22 times more volatile than MFF Capital Investments. It trades about 0.03 of its total potential returns per unit of risk. MFF Capital Investments is currently generating about 0.15 per unit of volatility. If you would invest 213.00 in MFF Capital Investments on September 2, 2024 and sell it today you would earn a total of 218.00 from holding MFF Capital Investments or generate 102.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centuria Capital vs. MFF Capital Investments
Performance |
| Timeline |
| Centuria Capital |
| MFF Capital Investments |
Centuria Capital and MFF Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centuria Capital and MFF Capital
The main advantage of trading using opposite Centuria Capital and MFF Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centuria Capital position performs unexpectedly, MFF 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 MFF Capital will offset losses from the drop in MFF Capital's long position.| Centuria Capital vs. Actinogen Medical | Centuria Capital vs. Hudson Investment Group | Centuria Capital vs. Pinnacle Investment Management | Centuria Capital vs. MFF Capital Investments |
| MFF Capital vs. Gold Road Resources | MFF Capital vs. 29Metals | MFF Capital vs. Land Homes Group | MFF Capital vs. Treasury Wine Estates |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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