Correlation Between MetLife and 36262GAB7

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Can any of the company-specific risk be diversified away by investing in both MetLife and 36262GAB7 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 36262GAB7 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and GXO 165 15 JUL 26, you can compare the effects of market volatilities on MetLife and 36262GAB7 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 36262GAB7. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and 36262GAB7.

Diversification Opportunities for MetLife and 36262GAB7

0.01
  Correlation Coefficient

Significant diversification

The 3 months correlation between MetLife and 36262GAB7 is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and GXO 165 15 JUL 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GXO 165 15 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 36262GAB7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GXO 165 15 has no effect on the direction of MetLife i.e., MetLife and 36262GAB7 go up and down completely randomly.

Pair Corralation between MetLife and 36262GAB7

Considering the 90-day investment horizon MetLife is expected to generate 1.59 times more return on investment than 36262GAB7. However, MetLife is 1.59 times more volatile than GXO 165 15 JUL 26. It trades about 0.3 of its potential returns per unit of risk. GXO 165 15 JUL 26 is currently generating about -0.16 per unit of risk. If you would invest  7,801  in MetLife on September 4, 2024 and sell it today you would earn a total of  887.00  from holding MetLife or generate 11.37% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy90.48%
ValuesDaily Returns

MetLife  vs.  GXO 165 15 JUL 26

 Performance 
       Timeline  
MetLife 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in MetLife are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting technical and fundamental indicators, MetLife unveiled solid returns over the last few months and may actually be approaching a breakup point.
GXO 165 15 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days GXO 165 15 JUL 26 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 36262GAB7 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

MetLife and 36262GAB7 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with MetLife and 36262GAB7

The main advantage of trading using opposite MetLife and 36262GAB7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, 36262GAB7 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 36262GAB7 will offset losses from the drop in 36262GAB7's long position.
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The idea behind MetLife and GXO 165 15 JUL 26 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

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