Correlation Between Medallion Financial and Orix Corp
Can any of the company-specific risk be diversified away by investing in both Medallion Financial and Orix Corp 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 Medallion Financial and Orix Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medallion Financial Corp and Orix Corp Ads, you can compare the effects of market volatilities on Medallion Financial and Orix Corp 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 Medallion Financial with a short position of Orix Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medallion Financial and Orix Corp.
Diversification Opportunities for Medallion Financial and Orix Corp
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Medallion and Orix is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Medallion Financial Corp and Orix Corp Ads in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orix Corp Ads and Medallion Financial 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 Medallion Financial Corp are associated (or correlated) with Orix Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orix Corp Ads has no effect on the direction of Medallion Financial i.e., Medallion Financial and Orix Corp go up and down completely randomly.
Pair Corralation between Medallion Financial and Orix Corp
Given the investment horizon of 90 days Medallion Financial Corp is expected to generate 1.37 times more return on investment than Orix Corp. However, Medallion Financial is 1.37 times more volatile than Orix Corp Ads. It trades about 0.05 of its potential returns per unit of risk. Orix Corp Ads is currently generating about -0.01 per unit of risk. If you would invest 892.00 in Medallion Financial Corp on October 24, 2024 and sell it today you would earn a total of 40.00 from holding Medallion Financial Corp or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medallion Financial Corp vs. Orix Corp Ads
Performance |
| Timeline |
| Medallion Financial Corp |
| Orix Corp Ads |
Medallion Financial and Orix Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medallion Financial and Orix Corp
The main advantage of trading using opposite Medallion Financial and Orix Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medallion Financial position performs unexpectedly, Orix Corp 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 Orix Corp will offset losses from the drop in Orix Corp's long position.| Medallion Financial vs. Midland States Bancorp | Medallion Financial vs. Western New England | Medallion Financial vs. Merchants Bancorp | Medallion Financial vs. MidWestOne Financial Group |
| Orix Corp vs. Federal Agricultural Mortgage | Orix Corp vs. Atlanticus Holdings Corp | Orix Corp vs. Nelnet Inc | Orix Corp vs. EZCORP Inc |
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 Positions Ratings module to 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.
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