Correlation Between Eco Animal and Mulberry Group

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Eco Animal and Mulberry Group 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 Eco Animal and Mulberry Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eco Animal Health and Mulberry Group PLC, you can compare the effects of market volatilities on Eco Animal and Mulberry Group 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 Eco Animal with a short position of Mulberry Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eco Animal and Mulberry Group.

Diversification Opportunities for Eco Animal and Mulberry Group

0.34
  Correlation Coefficient

Weak diversification

The 3 months correlation between Eco and Mulberry is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Eco Animal Health and Mulberry Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mulberry Group PLC and Eco Animal 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 Eco Animal Health are associated (or correlated) with Mulberry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mulberry Group PLC has no effect on the direction of Eco Animal i.e., Eco Animal and Mulberry Group go up and down completely randomly.

Pair Corralation between Eco Animal and Mulberry Group

Assuming the 90 days trading horizon Eco Animal Health is expected to generate 0.69 times more return on investment than Mulberry Group. However, Eco Animal Health is 1.46 times less risky than Mulberry Group. It trades about -0.01 of its potential returns per unit of risk. Mulberry Group PLC is currently generating about -0.07 per unit of risk. If you would invest  7,150  in Eco Animal Health on September 13, 2024 and sell it today you would lose (100.00) from holding Eco Animal Health or give up 1.4% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Eco Animal Health  vs.  Mulberry Group PLC

 Performance 
       Timeline  
Eco Animal Health 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Eco Animal Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
Mulberry Group PLC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mulberry Group PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Eco Animal and Mulberry Group Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Eco Animal and Mulberry Group

The main advantage of trading using opposite Eco Animal and Mulberry Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eco Animal position performs unexpectedly, Mulberry Group 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 Mulberry Group will offset losses from the drop in Mulberry Group's long position.
The idea behind Eco Animal Health and Mulberry Group PLC 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.
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.

Other Complementary Tools

Equity Valuation
Check real value of public entities based on technical and fundamental data
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Transaction History
View history of all your transactions and understand their impact on performance
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges