Correlation Between MCB GROUP and MAURITIUS METICS
Can any of the company-specific risk be diversified away by investing in both MCB GROUP and MAURITIUS METICS 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 MCB GROUP and MAURITIUS METICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MCB GROUP LIMITED and MAURITIUS METICS LTD, you can compare the effects of market volatilities on MCB GROUP and MAURITIUS METICS 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 MCB GROUP with a short position of MAURITIUS METICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of MCB GROUP and MAURITIUS METICS.
Diversification Opportunities for MCB GROUP and MAURITIUS METICS
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MCB and MAURITIUS is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding MCB GROUP LIMITED and MAURITIUS METICS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAURITIUS METICS LTD and MCB GROUP 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 MCB GROUP LIMITED are associated (or correlated) with MAURITIUS METICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAURITIUS METICS LTD has no effect on the direction of MCB GROUP i.e., MCB GROUP and MAURITIUS METICS go up and down completely randomly.
Pair Corralation between MCB GROUP and MAURITIUS METICS
Assuming the 90 days trading horizon MCB GROUP LIMITED is expected to generate 1.78 times more return on investment than MAURITIUS METICS. However, MCB GROUP is 1.78 times more volatile than MAURITIUS METICS LTD. It trades about 0.16 of its potential returns per unit of risk. MAURITIUS METICS LTD is currently generating about -0.15 per unit of risk. If you would invest 32,600 in MCB GROUP LIMITED on September 4, 2024 and sell it today you would earn a total of 11,450 from holding MCB GROUP LIMITED or generate 35.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
MCB GROUP LIMITED vs. MAURITIUS METICS LTD
Performance |
| Timeline |
| MCB GROUP LIMITED |
| MAURITIUS METICS LTD |
MCB GROUP and MAURITIUS METICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MCB GROUP and MAURITIUS METICS
The main advantage of trading using opposite MCB GROUP and MAURITIUS METICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MCB GROUP position performs unexpectedly, MAURITIUS METICS 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 MAURITIUS METICS will offset losses from the drop in MAURITIUS METICS's long position.| MCB GROUP vs. FINCORP INVESTMENT LTD | MCB GROUP vs. MUA LTD | MCB GROUP vs. LOTTOTECH LTD | MCB GROUP vs. LUX ISLAND RESORTS |
| MAURITIUS METICS vs. NEW MAURITIUS HOTELS | MAURITIUS METICS vs. PHOENIX BEVERAGES LTD | MAURITIUS METICS vs. BAYPORT MANAGEMENT LTD | MAURITIUS METICS vs. AFRICA CLEAN ENERGY |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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