Correlation Between Mangels Industrial and Sumitomo Mitsui
Can any of the company-specific risk be diversified away by investing in both Mangels Industrial and Sumitomo Mitsui 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 Sumitomo Mitsui 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 Sumitomo Mitsui Financial, you can compare the effects of market volatilities on Mangels Industrial and Sumitomo Mitsui 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 Sumitomo Mitsui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mangels Industrial and Sumitomo Mitsui.
Diversification Opportunities for Mangels Industrial and Sumitomo Mitsui
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mangels and Sumitomo is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Mangels Industrial SA and Sumitomo Mitsui Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Mitsui 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 Sumitomo Mitsui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Mitsui Financial has no effect on the direction of Mangels Industrial i.e., Mangels Industrial and Sumitomo Mitsui go up and down completely randomly.
Pair Corralation between Mangels Industrial and Sumitomo Mitsui
Assuming the 90 days trading horizon Mangels Industrial SA is expected to under-perform the Sumitomo Mitsui. In addition to that, Mangels Industrial is 1.28 times more volatile than Sumitomo Mitsui Financial. It trades about -0.01 of its total potential returns per unit of risk. Sumitomo Mitsui Financial is currently generating about 0.11 per unit of volatility. If you would invest 4,314 in Sumitomo Mitsui Financial on November 19, 2024 and sell it today you would earn a total of 4,139 from holding Sumitomo Mitsui Financial or generate 95.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 49.7% |
| Values | Daily Returns |
Mangels Industrial SA vs. Sumitomo Mitsui Financial
Performance |
| Timeline |
| Mangels Industrial |
| Sumitomo Mitsui Financial |
Mangels Industrial and Sumitomo Mitsui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mangels Industrial and Sumitomo Mitsui
The main advantage of trading using opposite Mangels Industrial and Sumitomo Mitsui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mangels Industrial position performs unexpectedly, Sumitomo Mitsui 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 Sumitomo Mitsui will offset losses from the drop in Sumitomo Mitsui'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 |
| Sumitomo Mitsui vs. Spotify Technology SA | Sumitomo Mitsui vs. Paycom Software | Sumitomo Mitsui vs. Deutsche Bank Aktiengesellschaft | Sumitomo Mitsui vs. ICICI Bank Limited |
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.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |