Correlation Between MSA Safety and Take Two
Can any of the company-specific risk be diversified away by investing in both MSA Safety and Take Two 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 MSA Safety and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MSA Safety Incorporated and Take Two Interactive Software, you can compare the effects of market volatilities on MSA Safety and Take Two 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 MSA Safety with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of MSA Safety and Take Two.
Diversification Opportunities for MSA Safety and Take Two
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MSA and Take is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding MSA Safety Incorporated and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and MSA Safety 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 MSA Safety Incorporated are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of MSA Safety i.e., MSA Safety and Take Two go up and down completely randomly.
Pair Corralation between MSA Safety and Take Two
Assuming the 90 days horizon MSA Safety Incorporated is expected to under-perform the Take Two. But the stock apears to be less risky and, when comparing its historical volatility, MSA Safety Incorporated is 1.21 times less risky than Take Two. The stock trades about -0.15 of its potential returns per unit of risk. The Take Two Interactive Software is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 17,722 in Take Two Interactive Software on October 30, 2024 and sell it today you would earn a total of 294.00 from holding Take Two Interactive Software or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MSA Safety Incorporated vs. Take Two Interactive Software
Performance |
| Timeline |
| MSA Safety |
| Take Two Interactive |
MSA Safety and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MSA Safety and Take Two
The main advantage of trading using opposite MSA Safety and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MSA Safety position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| MSA Safety vs. Carsales | MSA Safety vs. HUTCHISON TELECOMM | MSA Safety vs. Telecom Argentina SA | MSA Safety vs. Zoom Video Communications |
| Take Two vs. Perdoceo Education | Take Two vs. LANDSEA GREEN MANAGEMENT | Take Two vs. CeoTronics AG | Take Two vs. Synchrony 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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