Correlation Between M Food and Poznanska Korporacja
Can any of the company-specific risk be diversified away by investing in both M Food and Poznanska Korporacja 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 M Food and Poznanska Korporacja into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between M Food SA and Poznanska Korporacja Budowlana, you can compare the effects of market volatilities on M Food and Poznanska Korporacja 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 M Food with a short position of Poznanska Korporacja. Check out your portfolio center. Please also check ongoing floating volatility patterns of M Food and Poznanska Korporacja.
Diversification Opportunities for M Food and Poznanska Korporacja
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MFD and Poznanska is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding M Food SA and Poznanska Korporacja Budowlana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poznanska Korporacja and M Food 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 M Food SA are associated (or correlated) with Poznanska Korporacja. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poznanska Korporacja has no effect on the direction of M Food i.e., M Food and Poznanska Korporacja go up and down completely randomly.
Pair Corralation between M Food and Poznanska Korporacja
Assuming the 90 days trading horizon M Food SA is expected to under-perform the Poznanska Korporacja. In addition to that, M Food is 2.48 times more volatile than Poznanska Korporacja Budowlana. It trades about -0.41 of its total potential returns per unit of risk. Poznanska Korporacja Budowlana is currently generating about -0.42 per unit of volatility. If you would invest 2,040 in Poznanska Korporacja Budowlana on September 13, 2024 and sell it today you would lose (310.00) from holding Poznanska Korporacja Budowlana or give up 15.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 52.17% |
| Values | Daily Returns |
M Food SA vs. Poznanska Korporacja Budowlana
Performance |
| Timeline |
| M Food SA |
| Poznanska Korporacja |
M Food and Poznanska Korporacja Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with M Food and Poznanska Korporacja
The main advantage of trading using opposite M Food and Poznanska Korporacja positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if M Food position performs unexpectedly, Poznanska Korporacja 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 Poznanska Korporacja will offset losses from the drop in Poznanska Korporacja's long position.| M Food vs. PMPG Polskie Media | M Food vs. GreenX Metals | M Food vs. MCI Management SA | M Food vs. X Trade Brokers |
| Poznanska Korporacja vs. Asseco South Eastern | Poznanska Korporacja vs. Vercom SA | Poznanska Korporacja vs. CFI Holding SA | Poznanska Korporacja vs. Gobarto SA |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |