Correlation Between Mattel and MCBC Holdings
Can any of the company-specific risk be diversified away by investing in both Mattel and MCBC 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 Mattel and MCBC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mattel Inc and MCBC Holdings, you can compare the effects of market volatilities on Mattel and MCBC 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 Mattel with a short position of MCBC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mattel and MCBC Holdings.
Diversification Opportunities for Mattel and MCBC Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mattel and MCBC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mattel Inc and MCBC Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCBC Holdings 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 MCBC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCBC Holdings has no effect on the direction of Mattel i.e., Mattel and MCBC Holdings go up and down completely randomly.
Pair Corralation between Mattel and MCBC Holdings
Considering the 90-day investment horizon Mattel Inc is expected to generate 0.73 times more return on investment than MCBC Holdings. However, Mattel Inc is 1.36 times less risky than MCBC Holdings. It trades about 0.01 of its potential returns per unit of risk. MCBC Holdings is currently generating about 0.0 per unit of risk. If you would invest 1,807 in Mattel Inc on August 26, 2024 and sell it today you would earn a total of 62.00 from holding Mattel Inc or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mattel Inc vs. MCBC Holdings
Performance |
| Timeline |
| Mattel Inc |
| MCBC Holdings |
Mattel and MCBC Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mattel and MCBC Holdings
The main advantage of trading using opposite Mattel and MCBC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mattel position performs unexpectedly, MCBC 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 MCBC Holdings will offset losses from the drop in MCBC Holdings' long position.| Mattel vs. MCBC Holdings | Mattel vs. Winnebago Industries | Mattel vs. LCI Industries | Mattel vs. Thor Industries |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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