Correlation Between MFF Capital and Ingenia Communities
Can any of the company-specific risk be diversified away by investing in both MFF Capital and Ingenia Communities 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 Ingenia Communities 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 Ingenia Communities Group, you can compare the effects of market volatilities on MFF Capital and Ingenia Communities 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 Ingenia Communities. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFF Capital and Ingenia Communities.
Diversification Opportunities for MFF Capital and Ingenia Communities
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MFF and Ingenia is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding MFF Capital Investments and Ingenia Communities Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingenia Communities 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 Ingenia Communities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingenia Communities has no effect on the direction of MFF Capital i.e., MFF Capital and Ingenia Communities go up and down completely randomly.
Pair Corralation between MFF Capital and Ingenia Communities
Assuming the 90 days trading horizon MFF Capital Investments is expected to generate 0.77 times more return on investment than Ingenia Communities. However, MFF Capital Investments is 1.31 times less risky than Ingenia Communities. It trades about 0.44 of its potential returns per unit of risk. Ingenia Communities Group is currently generating about 0.2 per unit of risk. If you would invest 393.00 in MFF Capital Investments on September 5, 2024 and sell it today you would earn a total of 44.00 from holding MFF Capital Investments or generate 11.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFF Capital Investments vs. Ingenia Communities Group
Performance |
| Timeline |
| MFF Capital Investments |
| Ingenia Communities |
MFF Capital and Ingenia Communities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFF Capital and Ingenia Communities
The main advantage of trading using opposite MFF Capital and Ingenia Communities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFF Capital position performs unexpectedly, Ingenia Communities 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 Ingenia Communities will offset losses from the drop in Ingenia Communities' long position.| MFF Capital vs. GQG Partners DRC | MFF Capital vs. Metrics Master Income | MFF Capital vs. L1 Long Short | MFF Capital vs. Wam Leaders |
| Ingenia Communities vs. MFF Capital Investments | Ingenia Communities vs. Stelar Metals | Ingenia Communities vs. Black Rock Mining | Ingenia Communities vs. DY6 Metals |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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