Correlation Between MFF Capital and EMvision Medical
Can any of the company-specific risk be diversified away by investing in both MFF Capital and EMvision Medical 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 MFF Capital and EMvision Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFF Capital Investments and EMvision Medical Devices, you can compare the effects of market volatilities on MFF Capital and EMvision Medical 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 MFF Capital with a short position of EMvision Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFF Capital and EMvision Medical.
Diversification Opportunities for MFF Capital and EMvision Medical
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MFF and EMvision is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding MFF Capital Investments and EMvision Medical Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMvision Medical Devices and MFF Capital 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 MFF Capital Investments are associated (or correlated) with EMvision Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMvision Medical Devices has no effect on the direction of MFF Capital i.e., MFF Capital and EMvision Medical go up and down completely randomly.
Pair Corralation between MFF Capital and EMvision Medical
Assuming the 90 days trading horizon MFF Capital Investments is expected to generate 0.56 times more return on investment than EMvision Medical. However, MFF Capital Investments is 1.77 times less risky than EMvision Medical. It trades about 0.18 of its potential returns per unit of risk. EMvision Medical Devices is currently generating about -0.03 per unit of risk. If you would invest 464.00 in MFF Capital Investments on November 7, 2024 and sell it today you would earn a total of 14.00 from holding MFF Capital Investments or generate 3.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFF Capital Investments vs. EMvision Medical Devices
Performance |
| Timeline |
| MFF Capital Investments |
| EMvision Medical Devices |
MFF Capital and EMvision Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFF Capital and EMvision Medical
The main advantage of trading using opposite MFF Capital and EMvision Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFF Capital position performs unexpectedly, EMvision Medical 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 EMvision Medical will offset losses from the drop in EMvision Medical's long position.| MFF Capital vs. Collins Foods | MFF Capital vs. Qbe Insurance Group | MFF Capital vs. Macquarie Bank Limited | MFF Capital vs. Dexus Convenience Retail |
| EMvision Medical vs. Evolution Mining | EMvision Medical vs. Carnegie Clean Energy | EMvision Medical vs. MetalsGrove Mining | EMvision Medical vs. Genetic Technologies |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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