Correlation Between Multibax Public and SGF Capital
Can any of the company-specific risk be diversified away by investing in both Multibax Public and SGF Capital 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 Multibax Public and SGF Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multibax Public and SGF Capital Public, you can compare the effects of market volatilities on Multibax Public and SGF Capital 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 Multibax Public with a short position of SGF Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multibax Public and SGF Capital.
Diversification Opportunities for Multibax Public and SGF Capital
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Multibax and SGF is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Multibax Public and SGF Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGF Capital Public and Multibax Public 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 Multibax Public are associated (or correlated) with SGF Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGF Capital Public has no effect on the direction of Multibax Public i.e., Multibax Public and SGF Capital go up and down completely randomly.
Pair Corralation between Multibax Public and SGF Capital
Assuming the 90 days trading horizon Multibax Public is expected to generate 1.0 times more return on investment than SGF Capital. However, Multibax Public is 1.0 times less risky than SGF Capital. It trades about 0.04 of its potential returns per unit of risk. SGF Capital Public is currently generating about 0.04 per unit of risk. If you would invest 474.00 in Multibax Public on September 13, 2024 and sell it today you would lose (276.00) from holding Multibax Public or give up 58.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multibax Public vs. SGF Capital Public
Performance |
| Timeline |
| Multibax Public |
| SGF Capital Public |
Multibax Public and SGF Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multibax Public and SGF Capital
The main advantage of trading using opposite Multibax Public and SGF Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multibax Public position performs unexpectedly, SGF Capital 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 SGF Capital will offset losses from the drop in SGF Capital's long position.| Multibax Public vs. Lease IT Public | Multibax Public vs. MCS Steel Public | Multibax Public vs. Kingsmen CMTI Public | Multibax Public vs. Moong Pattana International |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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