Correlation Between Marks and VARIOUS EATERIES
Can any of the company-specific risk be diversified away by investing in both Marks and VARIOUS EATERIES 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 Marks and VARIOUS EATERIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marks and Spencer and VARIOUS EATERIES LS, you can compare the effects of market volatilities on Marks and VARIOUS EATERIES 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 Marks with a short position of VARIOUS EATERIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marks and VARIOUS EATERIES.
Diversification Opportunities for Marks and VARIOUS EATERIES
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Marks and VARIOUS is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Marks and Spencer and VARIOUS EATERIES LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VARIOUS EATERIES and Marks 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 Marks and Spencer are associated (or correlated) with VARIOUS EATERIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VARIOUS EATERIES has no effect on the direction of Marks i.e., Marks and VARIOUS EATERIES go up and down completely randomly.
Pair Corralation between Marks and VARIOUS EATERIES
Assuming the 90 days horizon Marks and Spencer is expected to generate 0.61 times more return on investment than VARIOUS EATERIES. However, Marks and Spencer is 1.64 times less risky than VARIOUS EATERIES. It trades about -0.11 of its potential returns per unit of risk. VARIOUS EATERIES LS is currently generating about -0.12 per unit of risk. If you would invest 474.00 in Marks and Spencer on October 10, 2024 and sell it today you would lose (13.00) from holding Marks and Spencer or give up 2.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marks and Spencer vs. VARIOUS EATERIES LS
Performance |
| Timeline |
| Marks and Spencer |
| VARIOUS EATERIES |
Marks and VARIOUS EATERIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marks and VARIOUS EATERIES
The main advantage of trading using opposite Marks and VARIOUS EATERIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marks position performs unexpectedly, VARIOUS EATERIES 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 VARIOUS EATERIES will offset losses from the drop in VARIOUS EATERIES's long position.| Marks vs. MIRAMAR HOTEL INV | Marks vs. TRADEDOUBLER AB SK | Marks vs. Fast Retailing Co | Marks vs. Choice Hotels International |
| VARIOUS EATERIES vs. Superior Plus Corp | VARIOUS EATERIES vs. NMI Holdings | VARIOUS EATERIES vs. SIVERS SEMICONDUCTORS AB | VARIOUS EATERIES vs. Talanx AG |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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