Correlation Between Magna International and NEWFIELD
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By analyzing existing cross correlation between Magna International and NEWFIELD EXPL 5375, you can compare the effects of market volatilities on Magna International and NEWFIELD 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 Magna International with a short position of NEWFIELD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna International and NEWFIELD.
Diversification Opportunities for Magna International and NEWFIELD
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Magna and NEWFIELD is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Magna International and NEWFIELD EXPL 5375 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEWFIELD EXPL 5375 and Magna International 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 Magna International are associated (or correlated) with NEWFIELD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEWFIELD EXPL 5375 has no effect on the direction of Magna International i.e., Magna International and NEWFIELD go up and down completely randomly.
Pair Corralation between Magna International and NEWFIELD
Considering the 90-day investment horizon Magna International is expected to generate 6.33 times more return on investment than NEWFIELD. However, Magna International is 6.33 times more volatile than NEWFIELD EXPL 5375. It trades about 0.08 of its potential returns per unit of risk. NEWFIELD EXPL 5375 is currently generating about 0.11 per unit of risk. If you would invest 4,369 in Magna International on September 13, 2024 and sell it today you would earn a total of 121.00 from holding Magna International or generate 2.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Magna International vs. NEWFIELD EXPL 5375
Performance |
| Timeline |
| Magna International |
| NEWFIELD EXPL 5375 |
Magna International and NEWFIELD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magna International and NEWFIELD
The main advantage of trading using opposite Magna International and NEWFIELD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna International position performs unexpectedly, NEWFIELD 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 NEWFIELD will offset losses from the drop in NEWFIELD's long position.| Magna International vs. Allison Transmission Holdings | Magna International vs. Aptiv PLC | Magna International vs. LKQ Corporation | Magna International vs. Lear Corporation |
| NEWFIELD vs. Diageo PLC ADR | NEWFIELD vs. Constellation Brands Class | NEWFIELD vs. Small Cap Premium | NEWFIELD vs. Molson Coors Brewing |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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