Correlation Between Miquel Y and NBI Bearings
Can any of the company-specific risk be diversified away by investing in both Miquel Y and NBI Bearings 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 Miquel Y and NBI Bearings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miquel y Costas and NBI Bearings Europe, you can compare the effects of market volatilities on Miquel Y and NBI Bearings 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 Miquel Y with a short position of NBI Bearings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miquel Y and NBI Bearings.
Diversification Opportunities for Miquel Y and NBI Bearings
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Miquel and NBI is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Miquel y Costas and NBI Bearings Europe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBI Bearings Europe and Miquel Y 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 Miquel y Costas are associated (or correlated) with NBI Bearings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBI Bearings Europe has no effect on the direction of Miquel Y i.e., Miquel Y and NBI Bearings go up and down completely randomly.
Pair Corralation between Miquel Y and NBI Bearings
Assuming the 90 days trading horizon Miquel y Costas is expected to generate 1.29 times more return on investment than NBI Bearings. However, Miquel Y is 1.29 times more volatile than NBI Bearings Europe. It trades about 0.06 of its potential returns per unit of risk. NBI Bearings Europe is currently generating about -0.02 per unit of risk. If you would invest 1,096 in Miquel y Costas on November 3, 2024 and sell it today you would earn a total of 214.00 from holding Miquel y Costas or generate 19.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miquel y Costas vs. NBI Bearings Europe
Performance |
| Timeline |
| Miquel y Costas |
| NBI Bearings Europe |
Miquel Y and NBI Bearings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miquel Y and NBI Bearings
The main advantage of trading using opposite Miquel Y and NBI Bearings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miquel Y position performs unexpectedly, NBI Bearings 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 NBI Bearings will offset losses from the drop in NBI Bearings' long position.| Miquel Y vs. Vidrala SA | Miquel Y vs. Grupo Catalana Occidente | Miquel Y vs. Iberpapel Gestion SA | Miquel Y vs. Cia de Distribucion |
| NBI Bearings vs. Metrovacesa SA | NBI Bearings vs. Elecnor SA | NBI Bearings vs. Mapfre | NBI Bearings vs. Tander Inversiones SOCIMI |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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