Correlation Between Walt Disney and Mangels Industrial
Can any of the company-specific risk be diversified away by investing in both Walt Disney and Mangels Industrial 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 Walt Disney and Mangels Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Walt Disney and Mangels Industrial SA, you can compare the effects of market volatilities on Walt Disney and Mangels Industrial 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 Walt Disney with a short position of Mangels Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walt Disney and Mangels Industrial.
Diversification Opportunities for Walt Disney and Mangels Industrial
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Walt and Mangels is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding The Walt Disney and Mangels Industrial SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mangels Industrial and Walt Disney 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 The Walt Disney are associated (or correlated) with Mangels Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mangels Industrial has no effect on the direction of Walt Disney i.e., Walt Disney and Mangels Industrial go up and down completely randomly.
Pair Corralation between Walt Disney and Mangels Industrial
Assuming the 90 days trading horizon The Walt Disney is expected to generate 0.49 times more return on investment than Mangels Industrial. However, The Walt Disney is 2.03 times less risky than Mangels Industrial. It trades about 0.03 of its potential returns per unit of risk. Mangels Industrial SA is currently generating about -0.01 per unit of risk. If you would invest 3,583 in The Walt Disney on October 13, 2024 and sell it today you would earn a total of 781.00 from holding The Walt Disney or generate 21.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.59% |
| Values | Daily Returns |
The Walt Disney vs. Mangels Industrial SA
Performance |
| Timeline |
| Walt Disney |
| Mangels Industrial |
Walt Disney and Mangels Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walt Disney and Mangels Industrial
The main advantage of trading using opposite Walt Disney and Mangels Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walt Disney position performs unexpectedly, Mangels Industrial 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 Mangels Industrial will offset losses from the drop in Mangels Industrial's long position.| Walt Disney vs. Mangels Industrial SA | Walt Disney vs. MAHLE Metal Leve | Walt Disney vs. British American Tobacco | Walt Disney vs. Omega Healthcare Investors, |
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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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