Correlation Between Mitsubishi UFJ and Sassy Resources
Can any of the company-specific risk be diversified away by investing in both Mitsubishi UFJ and Sassy Resources 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 Mitsubishi UFJ and Sassy Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitsubishi UFJ Financial and Sassy Resources, you can compare the effects of market volatilities on Mitsubishi UFJ and Sassy Resources 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 Mitsubishi UFJ with a short position of Sassy Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitsubishi UFJ and Sassy Resources.
Diversification Opportunities for Mitsubishi UFJ and Sassy Resources
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mitsubishi and Sassy is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Mitsubishi UFJ Financial and Sassy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sassy Resources and Mitsubishi UFJ 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 Mitsubishi UFJ Financial are associated (or correlated) with Sassy Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sassy Resources has no effect on the direction of Mitsubishi UFJ i.e., Mitsubishi UFJ and Sassy Resources go up and down completely randomly.
Pair Corralation between Mitsubishi UFJ and Sassy Resources
Assuming the 90 days horizon Mitsubishi UFJ is expected to generate 3.93 times less return on investment than Sassy Resources. But when comparing it to its historical volatility, Mitsubishi UFJ Financial is 6.04 times less risky than Sassy Resources. It trades about 0.06 of its potential returns per unit of risk. Sassy Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 55.00 in Sassy Resources on October 25, 2024 and sell it today you would lose (48.50) from holding Sassy Resources or give up 88.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.56% |
| Values | Daily Returns |
Mitsubishi UFJ Financial vs. Sassy Resources
Performance |
| Timeline |
| Mitsubishi UFJ Financial |
| Sassy Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Mitsubishi UFJ and Sassy Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitsubishi UFJ and Sassy Resources
The main advantage of trading using opposite Mitsubishi UFJ and Sassy Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitsubishi UFJ position performs unexpectedly, Sassy Resources 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 Sassy Resources will offset losses from the drop in Sassy Resources' long position.| Mitsubishi UFJ vs. Banco Bilbao Vizcaya | Mitsubishi UFJ vs. China Construction Bank | Mitsubishi UFJ vs. Bank of America | Mitsubishi UFJ vs. Agricultural Bank |
| Sassy Resources vs. Metals X Limited | Sassy Resources vs. Nevada King Gold | Sassy Resources vs. Azimut Exploration | Sassy Resources vs. Prime Meridian Resources |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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