Correlation Between Mattel and Fair Isaac
Can any of the company-specific risk be diversified away by investing in both Mattel and Fair Isaac 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 Mattel and Fair Isaac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mattel Inc and Fair Isaac, you can compare the effects of market volatilities on Mattel and Fair Isaac 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 Mattel with a short position of Fair Isaac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mattel and Fair Isaac.
Diversification Opportunities for Mattel and Fair Isaac
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mattel and Fair is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Mattel Inc and Fair Isaac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fair Isaac and Mattel 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 Mattel Inc are associated (or correlated) with Fair Isaac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fair Isaac has no effect on the direction of Mattel i.e., Mattel and Fair Isaac go up and down completely randomly.
Pair Corralation between Mattel and Fair Isaac
Considering the 90-day investment horizon Mattel Inc is expected to generate 0.64 times more return on investment than Fair Isaac. However, Mattel Inc is 1.57 times less risky than Fair Isaac. It trades about 0.24 of its potential returns per unit of risk. Fair Isaac is currently generating about -0.17 per unit of risk. If you would invest 1,773 in Mattel Inc on November 3, 2024 and sell it today you would earn a total of 98.50 from holding Mattel Inc or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mattel Inc vs. Fair Isaac
Performance |
| Timeline |
| Mattel Inc |
| Fair Isaac |
Mattel and Fair Isaac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mattel and Fair Isaac
The main advantage of trading using opposite Mattel and Fair Isaac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mattel position performs unexpectedly, Fair Isaac 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 Fair Isaac will offset losses from the drop in Fair Isaac's long position.| Mattel vs. Funko Inc | Mattel vs. JAKKS Pacific | Mattel vs. Madison Square Garden | Mattel vs. Life Time Group |
| Fair Isaac vs. SAP SE ADR | Fair Isaac vs. Tyler Technologies | Fair Isaac vs. Roper Technologies, | Fair Isaac vs. Cadence Design Systems |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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