Correlation Between MAGNUM MINING and Smurfit Kappa
Can any of the company-specific risk be diversified away by investing in both MAGNUM MINING and Smurfit Kappa 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 MAGNUM MINING and Smurfit Kappa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAGNUM MINING EXP and Smurfit Kappa Group, you can compare the effects of market volatilities on MAGNUM MINING and Smurfit Kappa 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 MAGNUM MINING with a short position of Smurfit Kappa. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAGNUM MINING and Smurfit Kappa.
Diversification Opportunities for MAGNUM MINING and Smurfit Kappa
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MAGNUM and Smurfit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MAGNUM MINING EXP and Smurfit Kappa Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smurfit Kappa Group and MAGNUM MINING 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 MAGNUM MINING EXP are associated (or correlated) with Smurfit Kappa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smurfit Kappa Group has no effect on the direction of MAGNUM MINING i.e., MAGNUM MINING and Smurfit Kappa go up and down completely randomly.
Pair Corralation between MAGNUM MINING and Smurfit Kappa
If you would invest 4,206 in Smurfit Kappa Group on October 1, 2024 and sell it today you would earn a total of 854.00 from holding Smurfit Kappa Group or generate 20.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAGNUM MINING EXP vs. Smurfit Kappa Group
Performance |
| Timeline |
| MAGNUM MINING EXP |
| Smurfit Kappa Group |
MAGNUM MINING and Smurfit Kappa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAGNUM MINING and Smurfit Kappa
The main advantage of trading using opposite MAGNUM MINING and Smurfit Kappa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAGNUM MINING position performs unexpectedly, Smurfit Kappa 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 Smurfit Kappa will offset losses from the drop in Smurfit Kappa's long position.The idea behind MAGNUM MINING EXP and Smurfit Kappa Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Smurfit Kappa vs. Amcor plc | Smurfit Kappa vs. Amcor plc | Smurfit Kappa vs. Packaging of | Smurfit Kappa vs. Crown Holdings |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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