Correlation Between MKDWELL Tech and Xometry
Can any of the company-specific risk be diversified away by investing in both MKDWELL Tech and Xometry 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 MKDWELL Tech and Xometry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MKDWELL Tech Warrants and Xometry, you can compare the effects of market volatilities on MKDWELL Tech and Xometry 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 MKDWELL Tech with a short position of Xometry. Check out your portfolio center. Please also check ongoing floating volatility patterns of MKDWELL Tech and Xometry.
Diversification Opportunities for MKDWELL Tech and Xometry
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MKDWELL and Xometry is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding MKDWELL Tech Warrants and Xometry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xometry and MKDWELL Tech 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 MKDWELL Tech Warrants are associated (or correlated) with Xometry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xometry has no effect on the direction of MKDWELL Tech i.e., MKDWELL Tech and Xometry go up and down completely randomly.
Pair Corralation between MKDWELL Tech and Xometry
Assuming the 90 days horizon MKDWELL Tech Warrants is expected to generate 5.91 times more return on investment than Xometry. However, MKDWELL Tech is 5.91 times more volatile than Xometry. It trades about 0.1 of its potential returns per unit of risk. Xometry is currently generating about 0.03 per unit of risk. If you would invest 6.00 in MKDWELL Tech Warrants on November 9, 2024 and sell it today you would lose (5.00) from holding MKDWELL Tech Warrants or give up 83.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 46.04% |
| Values | Daily Returns |
MKDWELL Tech Warrants vs. Xometry
Performance |
| Timeline |
| MKDWELL Tech Warrants |
| Xometry |
MKDWELL Tech and Xometry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MKDWELL Tech and Xometry
The main advantage of trading using opposite MKDWELL Tech and Xometry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MKDWELL Tech position performs unexpectedly, Xometry 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 Xometry will offset losses from the drop in Xometry's long position.| MKDWELL Tech vs. Babcock Wilcox Enterprises | MKDWELL Tech vs. Crane Company | MKDWELL Tech vs. Hillenbrand | MKDWELL Tech vs. Ingersoll Rand |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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