Correlation Between Mlk Foods and Grupa KTY
Can any of the company-specific risk be diversified away by investing in both Mlk Foods and Grupa KTY 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 Mlk Foods and Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mlk Foods Public and Grupa KTY SA, you can compare the effects of market volatilities on Mlk Foods and Grupa KTY 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 Mlk Foods with a short position of Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mlk Foods and Grupa KTY.
Diversification Opportunities for Mlk Foods and Grupa KTY
Very weak diversification
The 3 months correlation between Mlk and Grupa is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Mlk Foods Public and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA and Mlk Foods 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 Mlk Foods Public are associated (or correlated) with Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of Mlk Foods i.e., Mlk Foods and Grupa KTY go up and down completely randomly.
Pair Corralation between Mlk Foods and Grupa KTY
Assuming the 90 days trading horizon Mlk Foods Public is expected to generate 2.64 times more return on investment than Grupa KTY. However, Mlk Foods is 2.64 times more volatile than Grupa KTY SA. It trades about 0.07 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.01 per unit of risk. If you would invest 69.00 in Mlk Foods Public on September 15, 2024 and sell it today you would earn a total of 55.00 from holding Mlk Foods Public or generate 79.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mlk Foods Public vs. Grupa KTY SA
Performance |
| Timeline |
| Mlk Foods Public |
| Grupa KTY SA |
Mlk Foods and Grupa KTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mlk Foods and Grupa KTY
The main advantage of trading using opposite Mlk Foods and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mlk Foods position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY's long position.| Mlk Foods vs. LSI Software SA | Mlk Foods vs. Carlson Investments SA | Mlk Foods vs. Enter Air SA | Mlk Foods vs. PZ Cormay SA |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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