Correlation Between MAHLE Metal and Phillips
Can any of the company-specific risk be diversified away by investing in both MAHLE Metal and Phillips 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 Phillips 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 Phillips 66, you can compare the effects of market volatilities on MAHLE Metal and Phillips 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 Phillips. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAHLE Metal and Phillips.
Diversification Opportunities for MAHLE Metal and Phillips
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MAHLE and Phillips is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MAHLE Metal Leve and Phillips 66 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phillips 66 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 Phillips. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phillips 66 has no effect on the direction of MAHLE Metal i.e., MAHLE Metal and Phillips go up and down completely randomly.
Pair Corralation between MAHLE Metal and Phillips
Assuming the 90 days trading horizon MAHLE Metal Leve is expected to under-perform the Phillips. In addition to that, MAHLE Metal is 1.18 times more volatile than Phillips 66. It trades about -0.03 of its total potential returns per unit of risk. Phillips 66 is currently generating about 0.0 per unit of volatility. If you would invest 35,953 in Phillips 66 on October 25, 2024 and sell it today you would lose (415.00) from holding Phillips 66 or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 91.75% |
| Values | Daily Returns |
MAHLE Metal Leve vs. Phillips 66
Performance |
| Timeline |
| MAHLE Metal Leve |
| Phillips 66 |
MAHLE Metal and Phillips Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAHLE Metal and Phillips
The main advantage of trading using opposite MAHLE Metal and Phillips positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAHLE Metal position performs unexpectedly, Phillips 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 Phillips will offset losses from the drop in Phillips' long position.| MAHLE Metal vs. Tupy SA | MAHLE Metal vs. Engie Brasil Energia | MAHLE Metal vs. Grendene SA | MAHLE Metal vs. M Dias Branco |
| Phillips vs. Cardinal Health, | Phillips vs. Unity Software | Phillips vs. Guidewire Software, | Phillips vs. Spotify Technology 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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