Correlation Between Marubeni Corp and Mytilineos Holdings
Can any of the company-specific risk be diversified away by investing in both Marubeni Corp and Mytilineos 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 Marubeni Corp and Mytilineos Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marubeni Corp ADR and Mytilineos Holdings SA, you can compare the effects of market volatilities on Marubeni Corp and Mytilineos 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 Marubeni Corp with a short position of Mytilineos Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marubeni Corp and Mytilineos Holdings.
Diversification Opportunities for Marubeni Corp and Mytilineos Holdings
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marubeni and Mytilineos is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Marubeni Corp ADR and Mytilineos Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mytilineos Holdings and Marubeni Corp 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 Marubeni Corp ADR are associated (or correlated) with Mytilineos Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mytilineos Holdings has no effect on the direction of Marubeni Corp i.e., Marubeni Corp and Mytilineos Holdings go up and down completely randomly.
Pair Corralation between Marubeni Corp and Mytilineos Holdings
Assuming the 90 days horizon Marubeni Corp ADR is expected to generate 0.94 times more return on investment than Mytilineos Holdings. However, Marubeni Corp ADR is 1.06 times less risky than Mytilineos Holdings. It trades about 0.03 of its potential returns per unit of risk. Mytilineos Holdings SA is currently generating about -0.3 per unit of risk. If you would invest 15,387 in Marubeni Corp ADR on August 29, 2024 and sell it today you would earn a total of 135.00 from holding Marubeni Corp ADR or generate 0.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marubeni Corp ADR vs. Mytilineos Holdings SA
Performance |
| Timeline |
| Marubeni Corp ADR |
| Mytilineos Holdings |
Marubeni Corp and Mytilineos Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marubeni Corp and Mytilineos Holdings
The main advantage of trading using opposite Marubeni Corp and Mytilineos Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marubeni Corp position performs unexpectedly, Mytilineos 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 Mytilineos Holdings will offset losses from the drop in Mytilineos Holdings' long position.| Marubeni Corp vs. Mitsubishi Corp | Marubeni Corp vs. Itochu Corp ADR | Marubeni Corp vs. Marubeni | Marubeni Corp vs. Sumitomo Corp ADR |
| Mytilineos Holdings vs. Honeywell International | Mytilineos Holdings vs. MDU Resources Group | Mytilineos Holdings vs. Compass Diversified Holdings | Mytilineos Holdings vs. Valmont Industries |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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