Correlation Between MCAN Mortgage and Guild Holdings
Can any of the company-specific risk be diversified away by investing in both MCAN Mortgage and Guild Holdings 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 MCAN Mortgage and Guild Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MCAN Mortgage and Guild Holdings Co, you can compare the effects of market volatilities on MCAN Mortgage and Guild Holdings 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 MCAN Mortgage with a short position of Guild Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCAN Mortgage and Guild Holdings.
Diversification Opportunities for MCAN Mortgage and Guild Holdings
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MCAN and Guild is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding MCAN Mortgage and Guild Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guild Holdings and MCAN Mortgage 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 MCAN Mortgage are associated (or correlated) with Guild Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guild Holdings has no effect on the direction of MCAN Mortgage i.e., MCAN Mortgage and Guild Holdings go up and down completely randomly.
Pair Corralation between MCAN Mortgage and Guild Holdings
Assuming the 90 days horizon MCAN Mortgage is expected to generate 1.12 times more return on investment than Guild Holdings. However, MCAN Mortgage is 1.12 times more volatile than Guild Holdings Co. It trades about 0.1 of its potential returns per unit of risk. Guild Holdings Co is currently generating about -0.24 per unit of risk. If you would invest 1,356 in MCAN Mortgage on September 4, 2024 and sell it today you would earn a total of 39.00 from holding MCAN Mortgage or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
MCAN Mortgage vs. Guild Holdings Co
Performance |
| Timeline |
| MCAN Mortgage |
| Guild Holdings |
MCAN Mortgage and Guild Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCAN Mortgage and Guild Holdings
The main advantage of trading using opposite MCAN Mortgage and Guild Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCAN Mortgage position performs unexpectedly, Guild Holdings 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 Guild Holdings will offset losses from the drop in Guild Holdings' long position.| MCAN Mortgage vs. Western Asset Global | MCAN Mortgage vs. Invesco Trust For | MCAN Mortgage vs. Logan Ridge Finance | MCAN Mortgage vs. Invesco Advantage MIT |
| Guild Holdings vs. Mr Cooper Group | Guild Holdings vs. Encore Capital Group | Guild Holdings vs. CNFinance Holdings | Guild Holdings vs. Security National 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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