Correlation Between Mistras and Shift4 Payments
Can any of the company-specific risk be diversified away by investing in both Mistras and Shift4 Payments 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 Mistras and Shift4 Payments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mistras Group and Shift4 Payments, you can compare the effects of market volatilities on Mistras and Shift4 Payments 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 Mistras with a short position of Shift4 Payments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mistras and Shift4 Payments.
Diversification Opportunities for Mistras and Shift4 Payments
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mistras and Shift4 is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Mistras Group and Shift4 Payments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shift4 Payments and Mistras 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 Mistras Group are associated (or correlated) with Shift4 Payments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shift4 Payments has no effect on the direction of Mistras i.e., Mistras and Shift4 Payments go up and down completely randomly.
Pair Corralation between Mistras and Shift4 Payments
Allowing for the 90-day total investment horizon Mistras is expected to generate 1.3 times less return on investment than Shift4 Payments. But when comparing it to its historical volatility, Mistras Group is 1.66 times less risky than Shift4 Payments. It trades about 0.34 of its potential returns per unit of risk. Shift4 Payments is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 10,378 in Shift4 Payments on November 1, 2024 and sell it today you would earn a total of 1,326 from holding Shift4 Payments or generate 12.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mistras Group vs. Shift4 Payments
Performance |
| Timeline |
| Mistras Group |
| Shift4 Payments |
Mistras and Shift4 Payments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mistras and Shift4 Payments
The main advantage of trading using opposite Mistras and Shift4 Payments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mistras position performs unexpectedly, Shift4 Payments 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 Shift4 Payments will offset losses from the drop in Shift4 Payments' long position.| Mistras vs. Team Inc | Mistras vs. Thermon Group Holdings | Mistras vs. MRC Global | Mistras vs. Vishay Precision Group |
| Shift4 Payments vs. SentinelOne | Shift4 Payments vs. Confluent | Shift4 Payments vs. Hashicorp | Shift4 Payments vs. MongoDB |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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