Correlation Between MAHLE Metal and Companhia
Can any of the company-specific risk be diversified away by investing in both MAHLE Metal and Companhia 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 MAHLE Metal and Companhia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAHLE Metal Leve and Companhia de Tecidos, you can compare the effects of market volatilities on MAHLE Metal and Companhia 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 MAHLE Metal with a short position of Companhia. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAHLE Metal and Companhia.
Diversification Opportunities for MAHLE Metal and Companhia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MAHLE and Companhia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MAHLE Metal Leve and Companhia de Tecidos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia de Tecidos and MAHLE Metal 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 MAHLE Metal Leve are associated (or correlated) with Companhia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia de Tecidos has no effect on the direction of MAHLE Metal i.e., MAHLE Metal and Companhia go up and down completely randomly.
Pair Corralation between MAHLE Metal and Companhia
Assuming the 90 days trading horizon MAHLE Metal Leve is expected to generate 1.05 times more return on investment than Companhia. However, MAHLE Metal is 1.05 times more volatile than Companhia de Tecidos. It trades about -0.02 of its potential returns per unit of risk. Companhia de Tecidos is currently generating about -0.07 per unit of risk. If you would invest 3,036 in MAHLE Metal Leve on November 8, 2024 and sell it today you would lose (307.00) from holding MAHLE Metal Leve or give up 10.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
MAHLE Metal Leve vs. Companhia de Tecidos
Performance |
| Timeline |
| MAHLE Metal Leve |
| Companhia de Tecidos |
MAHLE Metal and Companhia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAHLE Metal and Companhia
The main advantage of trading using opposite MAHLE Metal and Companhia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAHLE Metal position performs unexpectedly, Companhia 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 Companhia will offset losses from the drop in Companhia's long position.| MAHLE Metal vs. Tupy SA | MAHLE Metal vs. Engie Brasil Energia | MAHLE Metal vs. Grendene SA | MAHLE Metal vs. M Dias Branco |
| Companhia vs. Marfrig Global Foods | Companhia vs. HDFC Bank Limited | Companhia vs. Bank of America | Companhia vs. Credit Acceptance |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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