Correlation Between MaxLinear and InPlay Oil
Can any of the company-specific risk be diversified away by investing in both MaxLinear and InPlay Oil 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 MaxLinear and InPlay Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MaxLinear and InPlay Oil Corp, you can compare the effects of market volatilities on MaxLinear and InPlay Oil 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 MaxLinear with a short position of InPlay Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of MaxLinear and InPlay Oil.
Diversification Opportunities for MaxLinear and InPlay Oil
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between MaxLinear and InPlay is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding MaxLinear and InPlay Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InPlay Oil Corp and MaxLinear 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 MaxLinear are associated (or correlated) with InPlay Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InPlay Oil Corp has no effect on the direction of MaxLinear i.e., MaxLinear and InPlay Oil go up and down completely randomly.
Pair Corralation between MaxLinear and InPlay Oil
Assuming the 90 days trading horizon MaxLinear is expected to under-perform the InPlay Oil. In addition to that, MaxLinear is 1.44 times more volatile than InPlay Oil Corp. It trades about -0.17 of its total potential returns per unit of risk. InPlay Oil Corp is currently generating about -0.02 per unit of volatility. If you would invest 108.00 in InPlay Oil Corp on November 28, 2024 and sell it today you would lose (2.00) from holding InPlay Oil Corp or give up 1.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
MaxLinear vs. InPlay Oil Corp
Performance |
| Timeline |
| MaxLinear |
| InPlay Oil Corp |
MaxLinear and InPlay Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MaxLinear and InPlay Oil
The main advantage of trading using opposite MaxLinear and InPlay Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MaxLinear position performs unexpectedly, InPlay Oil 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 InPlay Oil will offset losses from the drop in InPlay Oil's long position.| MaxLinear vs. ARISTOCRAT LEISURE | MaxLinear vs. UNIVERSAL DISPLAY | MaxLinear vs. Zoom Video Communications | MaxLinear vs. Aristocrat Leisure Limited |
| InPlay Oil vs. Guidewire Software | InPlay Oil vs. Check Point Software | InPlay Oil vs. Alfa Financial Software | InPlay Oil vs. BJs Restaurants |
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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