Correlation Between GWILLI FOOD and MUTUIONLINE
Can any of the company-specific risk be diversified away by investing in both GWILLI FOOD and MUTUIONLINE 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 GWILLI FOOD and MUTUIONLINE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GWILLI FOOD and MUTUIONLINE, you can compare the effects of market volatilities on GWILLI FOOD and MUTUIONLINE 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 GWILLI FOOD with a short position of MUTUIONLINE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GWILLI FOOD and MUTUIONLINE.
Diversification Opportunities for GWILLI FOOD and MUTUIONLINE
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GWILLI and MUTUIONLINE is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding GWILLI FOOD and MUTUIONLINE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MUTUIONLINE and GWILLI FOOD 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 GWILLI FOOD are associated (or correlated) with MUTUIONLINE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MUTUIONLINE has no effect on the direction of GWILLI FOOD i.e., GWILLI FOOD and MUTUIONLINE go up and down completely randomly.
Pair Corralation between GWILLI FOOD and MUTUIONLINE
Assuming the 90 days trading horizon GWILLI FOOD is expected to generate 0.7 times more return on investment than MUTUIONLINE. However, GWILLI FOOD is 1.42 times less risky than MUTUIONLINE. It trades about 0.07 of its potential returns per unit of risk. MUTUIONLINE is currently generating about 0.03 per unit of risk. If you would invest 1,550 in GWILLI FOOD on November 8, 2024 and sell it today you would earn a total of 30.00 from holding GWILLI FOOD or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GWILLI FOOD vs. MUTUIONLINE
Performance |
| Timeline |
| GWILLI FOOD |
| MUTUIONLINE |
GWILLI FOOD and MUTUIONLINE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GWILLI FOOD and MUTUIONLINE
The main advantage of trading using opposite GWILLI FOOD and MUTUIONLINE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GWILLI FOOD position performs unexpectedly, MUTUIONLINE 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 MUTUIONLINE will offset losses from the drop in MUTUIONLINE's long position.| GWILLI FOOD vs. Apple Inc | GWILLI FOOD vs. Apple Inc | GWILLI FOOD vs. Apple Inc | GWILLI FOOD vs. Apple Inc |
| MUTUIONLINE vs. CullenFrost Bankers | MUTUIONLINE vs. BANK OF CHINA | MUTUIONLINE vs. Meta Financial Group | MUTUIONLINE vs. CHIBA BANK |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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