Correlation Between Mount Gibson and Winnebago Industries
Can any of the company-specific risk be diversified away by investing in both Mount Gibson and Winnebago Industries 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 Mount Gibson and Winnebago Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mount Gibson Iron and Winnebago Industries, you can compare the effects of market volatilities on Mount Gibson and Winnebago Industries 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 Mount Gibson with a short position of Winnebago Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mount Gibson and Winnebago Industries.
Diversification Opportunities for Mount Gibson and Winnebago Industries
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mount and Winnebago is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Mount Gibson Iron and Winnebago Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winnebago Industries and Mount Gibson 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 Mount Gibson Iron are associated (or correlated) with Winnebago Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winnebago Industries has no effect on the direction of Mount Gibson i.e., Mount Gibson and Winnebago Industries go up and down completely randomly.
Pair Corralation between Mount Gibson and Winnebago Industries
Assuming the 90 days horizon Mount Gibson Iron is expected to generate 1.71 times more return on investment than Winnebago Industries. However, Mount Gibson is 1.71 times more volatile than Winnebago Industries. It trades about 0.02 of its potential returns per unit of risk. Winnebago Industries is currently generating about -0.15 per unit of risk. If you would invest 18.00 in Mount Gibson Iron on November 1, 2024 and sell it today you would earn a total of 0.00 from holding Mount Gibson Iron or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.44% |
| Values | Daily Returns |
Mount Gibson Iron vs. Winnebago Industries
Performance |
| Timeline |
| Mount Gibson Iron |
| Winnebago Industries |
Mount Gibson and Winnebago Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mount Gibson and Winnebago Industries
The main advantage of trading using opposite Mount Gibson and Winnebago Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mount Gibson position performs unexpectedly, Winnebago Industries 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 Winnebago Industries will offset losses from the drop in Winnebago Industries' long position.| Mount Gibson vs. REINET INVESTMENTS SCA | Mount Gibson vs. SEI INVESTMENTS | Mount Gibson vs. Keck Seng Investments | Mount Gibson vs. Scottish Mortgage Investment |
| Winnebago Industries vs. PLAYMATES TOYS | Winnebago Industries vs. 24SEVENOFFICE GROUP AB | Winnebago Industries vs. Playa Hotels Resorts | Winnebago Industries vs. TRAVEL LEISURE DL 01 |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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