Correlation Between MetLife and Movie Studio
Can any of the company-specific risk be diversified away by investing in both MetLife and Movie Studio 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 MetLife and Movie Studio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and Movie Studio, you can compare the effects of market volatilities on MetLife and Movie Studio 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 MetLife with a short position of Movie Studio. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Movie Studio.
Diversification Opportunities for MetLife and Movie Studio
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between MetLife and Movie is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Movie Studio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Movie Studio and MetLife 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 MetLife are associated (or correlated) with Movie Studio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Movie Studio has no effect on the direction of MetLife i.e., MetLife and Movie Studio go up and down completely randomly.
Pair Corralation between MetLife and Movie Studio
Considering the 90-day investment horizon MetLife is expected to generate 3.19 times less return on investment than Movie Studio. But when comparing it to its historical volatility, MetLife is 11.24 times less risky than Movie Studio. It trades about 0.3 of its potential returns per unit of risk. Movie Studio is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 0.10 in Movie Studio on September 4, 2024 and sell it today you would earn a total of 0.00 from holding Movie Studio or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
MetLife vs. Movie Studio
Performance |
| Timeline |
| MetLife |
| Movie Studio |
MetLife and Movie Studio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and Movie Studio
The main advantage of trading using opposite MetLife and Movie Studio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Movie Studio 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 Movie Studio will offset losses from the drop in Movie Studio's long position.| MetLife vs. Aflac Incorporated | MetLife vs. Manulife Financial Corp | MetLife vs. Jackson Financial | MetLife vs. Globe Life |
| Movie Studio vs. Roku Inc | Movie Studio vs. SNM Gobal Holdings | Movie Studio vs. Seven Arts Entertainment | Movie Studio vs. All For One |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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