Correlation Between MA Financial and Clime Investment
Can any of the company-specific risk be diversified away by investing in both MA Financial and Clime Investment 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 Clime Investment 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 Clime Investment Management, you can compare the effects of market volatilities on MA Financial and Clime Investment 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 Clime Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of MA Financial and Clime Investment.
Diversification Opportunities for MA Financial and Clime Investment
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MAF and Clime is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding MA Financial Group and Clime Investment Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clime Investment Man 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 Clime Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clime Investment Man has no effect on the direction of MA Financial i.e., MA Financial and Clime Investment go up and down completely randomly.
Pair Corralation between MA Financial and Clime Investment
If you would invest 35.00 in Clime Investment Management on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Clime Investment Management or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MA Financial Group vs. Clime Investment Management
Performance |
| Timeline |
| MA Financial Group |
| Clime Investment Man |
MA Financial and Clime Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MA Financial and Clime Investment
The main advantage of trading using opposite MA Financial and Clime Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MA Financial position performs unexpectedly, Clime Investment 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 Clime Investment will offset losses from the drop in Clime Investment's long position.| MA Financial vs. Hutchison Telecommunications | MA Financial vs. Apiam Animal Health | MA Financial vs. BTC Health Limited | MA Financial vs. Ramsay Health Care |
| Clime Investment vs. WA1 Resources | Clime Investment vs. Predictive Discovery | Clime Investment vs. Cooper Metals | Clime Investment vs. OD6 Metals |
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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