Correlation Between Mena Transport and Prodigy Public
Can any of the company-specific risk be diversified away by investing in both Mena Transport and Prodigy Public 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 Mena Transport and Prodigy Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mena Transport Public and Prodigy Public, you can compare the effects of market volatilities on Mena Transport and Prodigy Public 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 Mena Transport with a short position of Prodigy Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mena Transport and Prodigy Public.
Diversification Opportunities for Mena Transport and Prodigy Public
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mena and Prodigy is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Mena Transport Public and Prodigy Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodigy Public and Mena Transport 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 Mena Transport Public are associated (or correlated) with Prodigy Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodigy Public has no effect on the direction of Mena Transport i.e., Mena Transport and Prodigy Public go up and down completely randomly.
Pair Corralation between Mena Transport and Prodigy Public
Assuming the 90 days trading horizon Mena Transport Public is expected to under-perform the Prodigy Public. In addition to that, Mena Transport is 1.75 times more volatile than Prodigy Public. It trades about -0.14 of its total potential returns per unit of risk. Prodigy Public is currently generating about -0.08 per unit of volatility. If you would invest 268.00 in Prodigy Public on September 15, 2024 and sell it today you would lose (4.00) from holding Prodigy Public or give up 1.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mena Transport Public vs. Prodigy Public
Performance |
| Timeline |
| Mena Transport Public |
| Prodigy Public |
Mena Transport and Prodigy Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mena Transport and Prodigy Public
The main advantage of trading using opposite Mena Transport and Prodigy Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mena Transport position performs unexpectedly, Prodigy Public 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 Prodigy Public will offset losses from the drop in Prodigy Public's long position.| Mena Transport vs. Hwa Fong Rubber | Mena Transport vs. Karmarts Public | Mena Transport vs. Jay Mart Public | Mena Transport vs. IRPC Public |
| Prodigy Public vs. Bangkok Sheet Metal | Prodigy Public vs. Porn Prom Metal | Prodigy Public vs. 2S Metal Public | Prodigy Public vs. Mena Transport Public |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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