Correlation Between HM Inwest and MCI Management
Can any of the company-specific risk be diversified away by investing in both HM Inwest and MCI Management 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 HM Inwest and MCI Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HM Inwest SA and MCI Management SA, you can compare the effects of market volatilities on HM Inwest and MCI Management 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 HM Inwest with a short position of MCI Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of HM Inwest and MCI Management.
Diversification Opportunities for HM Inwest and MCI Management
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HMI and MCI is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding HM Inwest SA and MCI Management SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCI Management SA and HM Inwest 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 HM Inwest SA are associated (or correlated) with MCI Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCI Management SA has no effect on the direction of HM Inwest i.e., HM Inwest and MCI Management go up and down completely randomly.
Pair Corralation between HM Inwest and MCI Management
Assuming the 90 days trading horizon HM Inwest SA is expected to generate 1.54 times more return on investment than MCI Management. However, HM Inwest is 1.54 times more volatile than MCI Management SA. It trades about 0.05 of its potential returns per unit of risk. MCI Management SA is currently generating about 0.06 per unit of risk. If you would invest 3,300 in HM Inwest SA on September 14, 2024 and sell it today you would earn a total of 1,200 from holding HM Inwest SA or generate 36.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HM Inwest SA vs. MCI Management SA
Performance |
| Timeline |
| HM Inwest SA |
| MCI Management SA |
HM Inwest and MCI Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HM Inwest and MCI Management
The main advantage of trading using opposite HM Inwest and MCI Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HM Inwest position performs unexpectedly, MCI Management 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 MCI Management will offset losses from the drop in MCI Management's long position.| HM Inwest vs. Banco Santander SA | HM Inwest vs. UniCredit SpA | HM Inwest vs. CEZ as | HM Inwest vs. Polski Koncern Naftowy |
| MCI Management vs. Immobile | MCI Management vs. Asseco Business Solutions | MCI Management vs. Asseco South Eastern | MCI Management vs. HM Inwest SA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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