Correlation Between Medalist Diversified and Medallion Bank
Can any of the company-specific risk be diversified away by investing in both Medalist Diversified and Medallion Bank 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 Medalist Diversified and Medallion Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medalist Diversified Reit and Medallion Bank PR, you can compare the effects of market volatilities on Medalist Diversified and Medallion Bank 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 Medalist Diversified with a short position of Medallion Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medalist Diversified and Medallion Bank.
Diversification Opportunities for Medalist Diversified and Medallion Bank
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Medalist and Medallion is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Medalist Diversified Reit and Medallion Bank PR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medallion Bank PR and Medalist Diversified 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 Medalist Diversified Reit are associated (or correlated) with Medallion Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medallion Bank PR has no effect on the direction of Medalist Diversified i.e., Medalist Diversified and Medallion Bank go up and down completely randomly.
Pair Corralation between Medalist Diversified and Medallion Bank
Assuming the 90 days horizon Medalist Diversified Reit is expected to generate 2.46 times more return on investment than Medallion Bank. However, Medalist Diversified is 2.46 times more volatile than Medallion Bank PR. It trades about 0.1 of its potential returns per unit of risk. Medallion Bank PR is currently generating about 0.06 per unit of risk. If you would invest 2,425 in Medalist Diversified Reit on August 28, 2024 and sell it today you would earn a total of 132.00 from holding Medalist Diversified Reit or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medalist Diversified Reit vs. Medallion Bank PR
Performance |
| Timeline |
| Medalist Diversified Reit |
| Medallion Bank PR |
Medalist Diversified and Medallion Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medalist Diversified and Medallion Bank
The main advantage of trading using opposite Medalist Diversified and Medallion Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medalist Diversified position performs unexpectedly, Medallion Bank 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 Medallion Bank will offset losses from the drop in Medallion Bank's long position.| Medalist Diversified vs. Medallion Bank PR | Medalist Diversified vs. Sotherly Hotels PR | Medalist Diversified vs. Healthcare Trust PR | Medalist Diversified vs. Sotherly Hotels Series |
| Medallion Bank vs. Merchants Bancorp | Medallion Bank vs. Medalist Diversified Reit | Medallion Bank vs. Northern Trust | Medallion Bank vs. First Citizens BancShares |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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