Correlation Between Impact Fusion and MGO Global
Can any of the company-specific risk be diversified away by investing in both Impact Fusion and MGO Global 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 Impact Fusion and MGO Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impact Fusion International and MGO Global Common, you can compare the effects of market volatilities on Impact Fusion and MGO Global 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 Impact Fusion with a short position of MGO Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impact Fusion and MGO Global.
Diversification Opportunities for Impact Fusion and MGO Global
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Impact and MGO is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Impact Fusion International and MGO Global Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGO Global Common and Impact Fusion 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 Impact Fusion International are associated (or correlated) with MGO Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGO Global Common has no effect on the direction of Impact Fusion i.e., Impact Fusion and MGO Global go up and down completely randomly.
Pair Corralation between Impact Fusion and MGO Global
Given the investment horizon of 90 days Impact Fusion International is expected to generate 0.53 times more return on investment than MGO Global. However, Impact Fusion International is 1.9 times less risky than MGO Global. It trades about -0.12 of its potential returns per unit of risk. MGO Global Common is currently generating about -0.2 per unit of risk. If you would invest 7.80 in Impact Fusion International on November 2, 2024 and sell it today you would lose (4.74) from holding Impact Fusion International or give up 60.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.04% |
| Values | Daily Returns |
Impact Fusion International vs. MGO Global Common
Performance |
| Timeline |
| Impact Fusion Intern |
| MGO Global Common |
Impact Fusion and MGO Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impact Fusion and MGO Global
The main advantage of trading using opposite Impact Fusion and MGO Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impact Fusion position performs unexpectedly, MGO Global 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 MGO Global will offset losses from the drop in MGO Global's long position.| Impact Fusion vs. Digital Brand Media | Impact Fusion vs. Beyond Commerce | Impact Fusion vs. Glory Star New | Impact Fusion vs. Baosheng Media Group |
| MGO Global vs. Baosheng Media Group | MGO Global vs. National CineMedia | MGO Global vs. Glory Star New | MGO Global vs. Impact Fusion International |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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