Correlation Between Maggie Beer and Mayfield Childcare
Can any of the company-specific risk be diversified away by investing in both Maggie Beer and Mayfield Childcare 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 Maggie Beer and Mayfield Childcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maggie Beer Holdings and Mayfield Childcare, you can compare the effects of market volatilities on Maggie Beer and Mayfield Childcare 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 Maggie Beer with a short position of Mayfield Childcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maggie Beer and Mayfield Childcare.
Diversification Opportunities for Maggie Beer and Mayfield Childcare
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maggie and Mayfield is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Maggie Beer Holdings and Mayfield Childcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mayfield Childcare and Maggie Beer 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 Maggie Beer Holdings are associated (or correlated) with Mayfield Childcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mayfield Childcare has no effect on the direction of Maggie Beer i.e., Maggie Beer and Mayfield Childcare go up and down completely randomly.
Pair Corralation between Maggie Beer and Mayfield Childcare
Assuming the 90 days trading horizon Maggie Beer Holdings is expected to generate 0.5 times more return on investment than Mayfield Childcare. However, Maggie Beer Holdings is 2.01 times less risky than Mayfield Childcare. It trades about 0.25 of its potential returns per unit of risk. Mayfield Childcare is currently generating about -0.12 per unit of risk. If you would invest 5.30 in Maggie Beer Holdings on October 15, 2024 and sell it today you would earn a total of 0.50 from holding Maggie Beer Holdings or generate 9.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maggie Beer Holdings vs. Mayfield Childcare
Performance |
| Timeline |
| Maggie Beer Holdings |
| Mayfield Childcare |
Maggie Beer and Mayfield Childcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maggie Beer and Mayfield Childcare
The main advantage of trading using opposite Maggie Beer and Mayfield Childcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maggie Beer position performs unexpectedly, Mayfield Childcare 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 Mayfield Childcare will offset losses from the drop in Mayfield Childcare's long position.| Maggie Beer vs. Sports Entertainment Group | Maggie Beer vs. ACDC Metals | Maggie Beer vs. 4Dmedical | Maggie Beer vs. K2 Asset Management |
| Mayfield Childcare vs. Technology One | Mayfield Childcare vs. Maggie Beer Holdings | Mayfield Childcare vs. Dug Technology | Mayfield Childcare vs. EMvision Medical Devices |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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