Correlation Between Impax Asset and Mitie Group
Can any of the company-specific risk be diversified away by investing in both Impax Asset and Mitie 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 Impax Asset and Mitie Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impax Asset Management and Mitie Group PLC, you can compare the effects of market volatilities on Impax Asset and Mitie 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 Impax Asset with a short position of Mitie Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impax Asset and Mitie Group.
Diversification Opportunities for Impax Asset and Mitie Group
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Impax and Mitie is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Impax Asset Management and Mitie Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitie Group PLC and Impax Asset 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 Impax Asset Management are associated (or correlated) with Mitie Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitie Group PLC has no effect on the direction of Impax Asset i.e., Impax Asset and Mitie Group go up and down completely randomly.
Pair Corralation between Impax Asset and Mitie Group
Assuming the 90 days trading horizon Impax Asset Management is expected to under-perform the Mitie Group. In addition to that, Impax Asset is 1.97 times more volatile than Mitie Group PLC. It trades about -0.22 of its total potential returns per unit of risk. Mitie Group PLC is currently generating about 0.01 per unit of volatility. If you would invest 11,602 in Mitie Group PLC on October 24, 2024 and sell it today you would lose (22.00) from holding Mitie Group PLC or give up 0.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Impax Asset Management vs. Mitie Group PLC
Performance |
| Timeline |
| Impax Asset Management |
| Mitie Group PLC |
Impax Asset and Mitie Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impax Asset and Mitie Group
The main advantage of trading using opposite Impax Asset and Mitie Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impax Asset position performs unexpectedly, Mitie 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 Mitie Group will offset losses from the drop in Mitie Group's long position.| Impax Asset vs. Arrow Electronics | Impax Asset vs. Eneraqua Technologies PLC | Impax Asset vs. Concurrent Technologies Plc | Impax Asset vs. Allianz Technology Trust |
| Mitie Group vs. Impax Asset Management | Mitie Group vs. Vienna Insurance Group | Mitie Group vs. Raymond James Financial | Mitie Group vs. Ally Financial |
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 CEOs Directory module to screen CEOs from public companies around the world.
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