Correlation Between MA Financial and Black Rock
Can any of the company-specific risk be diversified away by investing in both MA Financial and Black Rock 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 MA Financial and Black Rock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MA Financial Group and Black Rock Mining, you can compare the effects of market volatilities on MA Financial and Black Rock 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 MA Financial with a short position of Black Rock. Check out your portfolio center. Please also check ongoing floating volatility patterns of MA Financial and Black Rock.
Diversification Opportunities for MA Financial and Black Rock
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MAF and Black is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding MA Financial Group and Black Rock Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Rock Mining and MA Financial 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 MA Financial Group are associated (or correlated) with Black Rock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Rock Mining has no effect on the direction of MA Financial i.e., MA Financial and Black Rock go up and down completely randomly.
Pair Corralation between MA Financial and Black Rock
Assuming the 90 days trading horizon MA Financial Group is expected to generate 0.42 times more return on investment than Black Rock. However, MA Financial Group is 2.39 times less risky than Black Rock. It trades about -0.03 of its potential returns per unit of risk. Black Rock Mining is currently generating about -0.24 per unit of risk. If you would invest 631.00 in MA Financial Group on September 2, 2024 and sell it today you would lose (10.00) from holding MA Financial Group or give up 1.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MA Financial Group vs. Black Rock Mining
Performance |
| Timeline |
| MA Financial Group |
| Black Rock Mining |
MA Financial and Black Rock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MA Financial and Black Rock
The main advantage of trading using opposite MA Financial and Black Rock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MA Financial position performs unexpectedly, Black Rock 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 Black Rock will offset losses from the drop in Black Rock's long position.| MA Financial vs. Inventis | MA Financial vs. Pengana Private Equity | MA Financial vs. PM Capital Global | MA Financial vs. Macquarie Group Ltd |
| Black Rock vs. Northern Star Resources | Black Rock vs. Evolution Mining | Black Rock vs. Bluescope Steel | Black Rock vs. Sandfire Resources NL |
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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