Correlation Between Mattel and Inter Parfums
Can any of the company-specific risk be diversified away by investing in both Mattel and Inter Parfums 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 Inter Parfums into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mattel Inc and Inter Parfums, you can compare the effects of market volatilities on Mattel and Inter Parfums 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 Inter Parfums. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mattel and Inter Parfums.
Diversification Opportunities for Mattel and Inter Parfums
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mattel and Inter is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Mattel Inc and Inter Parfums in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Parfums 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 Inter Parfums. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Parfums has no effect on the direction of Mattel i.e., Mattel and Inter Parfums go up and down completely randomly.
Pair Corralation between Mattel and Inter Parfums
Considering the 90-day investment horizon Mattel is expected to generate 1.66 times less return on investment than Inter Parfums. In addition to that, Mattel is 1.16 times more volatile than Inter Parfums. It trades about 0.03 of its total potential returns per unit of risk. Inter Parfums is currently generating about 0.06 per unit of volatility. If you would invest 11,970 in Inter Parfums on September 1, 2024 and sell it today you would earn a total of 1,796 from holding Inter Parfums or generate 15.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mattel Inc vs. Inter Parfums
Performance |
| Timeline |
| Mattel Inc |
| Inter Parfums |
Mattel and Inter Parfums Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mattel and Inter Parfums
The main advantage of trading using opposite Mattel and Inter Parfums positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mattel position performs unexpectedly, Inter Parfums 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 Inter Parfums will offset losses from the drop in Inter Parfums' long position.| Mattel vs. Funko Inc | Mattel vs. JAKKS Pacific | Mattel vs. Madison Square Garden | Mattel vs. Life Time Group |
| Inter Parfums vs. Seneca Foods Corp | Inter Parfums vs. Central Garden Pet | Inter Parfums vs. Central Garden Pet | Inter Parfums vs. Lifeway Foods |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stocks Directory Find actively traded stocks across global markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |