Correlation Between MGIC INVESTMENT and SQUIRREL MEDIA
Can any of the company-specific risk be diversified away by investing in both MGIC INVESTMENT and SQUIRREL MEDIA 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 MGIC INVESTMENT and SQUIRREL MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGIC INVESTMENT and SQUIRREL MEDIA SA, you can compare the effects of market volatilities on MGIC INVESTMENT and SQUIRREL MEDIA 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 MGIC INVESTMENT with a short position of SQUIRREL MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGIC INVESTMENT and SQUIRREL MEDIA.
Diversification Opportunities for MGIC INVESTMENT and SQUIRREL MEDIA
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between MGIC and SQUIRREL is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding MGIC INVESTMENT and SQUIRREL MEDIA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SQUIRREL MEDIA SA and MGIC INVESTMENT 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 MGIC INVESTMENT are associated (or correlated) with SQUIRREL MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SQUIRREL MEDIA SA has no effect on the direction of MGIC INVESTMENT i.e., MGIC INVESTMENT and SQUIRREL MEDIA go up and down completely randomly.
Pair Corralation between MGIC INVESTMENT and SQUIRREL MEDIA
Assuming the 90 days trading horizon MGIC INVESTMENT is expected to generate 2.27 times less return on investment than SQUIRREL MEDIA. But when comparing it to its historical volatility, MGIC INVESTMENT is 2.07 times less risky than SQUIRREL MEDIA. It trades about 0.21 of its potential returns per unit of risk. SQUIRREL MEDIA SA is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 122.00 in SQUIRREL MEDIA SA on November 7, 2024 and sell it today you would earn a total of 17.00 from holding SQUIRREL MEDIA SA or generate 13.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MGIC INVESTMENT vs. SQUIRREL MEDIA SA
Performance |
| Timeline |
| MGIC INVESTMENT |
| SQUIRREL MEDIA SA |
MGIC INVESTMENT and SQUIRREL MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGIC INVESTMENT and SQUIRREL MEDIA
The main advantage of trading using opposite MGIC INVESTMENT and SQUIRREL MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGIC INVESTMENT position performs unexpectedly, SQUIRREL MEDIA 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 SQUIRREL MEDIA will offset losses from the drop in SQUIRREL MEDIA's long position.| MGIC INVESTMENT vs. Taiwan Semiconductor Manufacturing | MGIC INVESTMENT vs. SBM OFFSHORE | MGIC INVESTMENT vs. Semiconductor Manufacturing International | MGIC INVESTMENT vs. ON SEMICONDUCTOR |
| SQUIRREL MEDIA vs. The Walt Disney | SQUIRREL MEDIA vs. The Walt Disney | SQUIRREL MEDIA vs. Netflix | SQUIRREL MEDIA vs. Charter Communications |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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