Correlation Between Maximus and SMX Public
Can any of the company-specific risk be diversified away by investing in both Maximus and SMX Public 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 Maximus and SMX Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maximus and SMX Public Limited, you can compare the effects of market volatilities on Maximus and SMX Public 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 Maximus with a short position of SMX Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maximus and SMX Public.
Diversification Opportunities for Maximus and SMX Public
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Maximus and SMX is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Maximus and SMX Public Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMX Public Limited and Maximus 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 Maximus are associated (or correlated) with SMX Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMX Public Limited has no effect on the direction of Maximus i.e., Maximus and SMX Public go up and down completely randomly.
Pair Corralation between Maximus and SMX Public
Considering the 90-day investment horizon Maximus is expected to generate 9.63 times less return on investment than SMX Public. But when comparing it to its historical volatility, Maximus is 43.6 times less risky than SMX Public. It trades about 0.47 of its potential returns per unit of risk. SMX Public Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 629.00 in SMX Public Limited on October 23, 2024 and sell it today you would lose (93.00) from holding SMX Public Limited or give up 14.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maximus vs. SMX Public Limited
Performance |
| Timeline |
| Maximus |
| SMX Public Limited |
Maximus and SMX Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maximus and SMX Public
The main advantage of trading using opposite Maximus and SMX Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maximus position performs unexpectedly, SMX Public 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 SMX Public will offset losses from the drop in SMX Public's long position.| Maximus vs. Network 1 Technologies | Maximus vs. First Advantage Corp | Maximus vs. BrightView Holdings | Maximus vs. Civeo Corp |
| SMX Public vs. Team Inc | SMX Public vs. Lichen China Limited | SMX Public vs. System1 | SMX Public vs. Eastman Kodak Co |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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