Correlation Between Mangels Industrial and Jefferies Financial
Can any of the company-specific risk be diversified away by investing in both Mangels Industrial and Jefferies Financial 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 Mangels Industrial and Jefferies Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mangels Industrial SA and Jefferies Financial Group, you can compare the effects of market volatilities on Mangels Industrial and Jefferies Financial 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 Mangels Industrial with a short position of Jefferies Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mangels Industrial and Jefferies Financial.
Diversification Opportunities for Mangels Industrial and Jefferies Financial
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mangels and Jefferies is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Mangels Industrial SA and Jefferies Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jefferies Financial and Mangels Industrial 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 Mangels Industrial SA are associated (or correlated) with Jefferies Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jefferies Financial has no effect on the direction of Mangels Industrial i.e., Mangels Industrial and Jefferies Financial go up and down completely randomly.
Pair Corralation between Mangels Industrial and Jefferies Financial
Assuming the 90 days trading horizon Mangels Industrial SA is expected to under-perform the Jefferies Financial. In addition to that, Mangels Industrial is 1.64 times more volatile than Jefferies Financial Group. It trades about -0.03 of its total potential returns per unit of risk. Jefferies Financial Group is currently generating about 0.14 per unit of volatility. If you would invest 37,055 in Jefferies Financial Group on October 24, 2024 and sell it today you would earn a total of 9,005 from holding Jefferies Financial Group or generate 24.3% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Mangels Industrial SA vs. Jefferies Financial Group
Performance |
Timeline |
Mangels Industrial |
Jefferies Financial |
Mangels Industrial and Jefferies Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mangels Industrial and Jefferies Financial
The main advantage of trading using opposite Mangels Industrial and Jefferies Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mangels Industrial position performs unexpectedly, Jefferies Financial 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 Jefferies Financial will offset losses from the drop in Jefferies Financial's long position.Mangels Industrial vs. Inepar SA Indstria | Mangels Industrial vs. Lupatech SA | Mangels Industrial vs. Paranapanema SA | Mangels Industrial vs. Plascar Participaes Industriais |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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