Correlation Between Coty and MORGAN
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By analyzing existing cross correlation between Coty Inc and MORGAN STANLEY 3125, you can compare the effects of market volatilities on Coty and MORGAN 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 Coty with a short position of MORGAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coty and MORGAN.
Diversification Opportunities for Coty and MORGAN
Good diversification
The 3 months correlation between Coty and MORGAN is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Coty Inc and MORGAN STANLEY 3125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MORGAN STANLEY 3125 and Coty 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 Coty Inc are associated (or correlated) with MORGAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MORGAN STANLEY 3125 has no effect on the direction of Coty i.e., Coty and MORGAN go up and down completely randomly.
Pair Corralation between Coty and MORGAN
Given the investment horizon of 90 days Coty Inc is expected to generate 3.76 times more return on investment than MORGAN. However, Coty is 3.76 times more volatile than MORGAN STANLEY 3125. It trades about 0.17 of its potential returns per unit of risk. MORGAN STANLEY 3125 is currently generating about -0.19 per unit of risk. If you would invest 686.00 in Coty Inc on November 3, 2024 and sell it today you would earn a total of 47.00 from holding Coty Inc or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Coty Inc vs. MORGAN STANLEY 3125
Performance |
| Timeline |
| Coty Inc |
| MORGAN STANLEY 3125 |
Coty and MORGAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coty and MORGAN
The main advantage of trading using opposite Coty and MORGAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coty position performs unexpectedly, MORGAN 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 MORGAN will offset losses from the drop in MORGAN's long position.The idea behind Coty Inc and MORGAN STANLEY 3125 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.| MORGAN vs. AEP TEX INC | MORGAN vs. US BANK NATIONAL | MORGAN vs. Bayerische Motoren Werke | MORGAN vs. Check Point Software |
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 Stocks Directory module to find actively traded stocks across global markets.
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