Correlation Between Gruppo Mutuionline and EDISON INTL
Can any of the company-specific risk be diversified away by investing in both Gruppo Mutuionline and EDISON INTL 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 Gruppo Mutuionline and EDISON INTL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gruppo Mutuionline SpA and EDISON INTL, you can compare the effects of market volatilities on Gruppo Mutuionline and EDISON INTL 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 Gruppo Mutuionline with a short position of EDISON INTL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gruppo Mutuionline and EDISON INTL.
Diversification Opportunities for Gruppo Mutuionline and EDISON INTL
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Gruppo and EDISON is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Gruppo Mutuionline SpA and EDISON INTL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EDISON INTL and Gruppo Mutuionline 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 Gruppo Mutuionline SpA are associated (or correlated) with EDISON INTL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EDISON INTL has no effect on the direction of Gruppo Mutuionline i.e., Gruppo Mutuionline and EDISON INTL go up and down completely randomly.
Pair Corralation between Gruppo Mutuionline and EDISON INTL
Assuming the 90 days trading horizon Gruppo Mutuionline SpA is expected to generate 0.38 times more return on investment than EDISON INTL. However, Gruppo Mutuionline SpA is 2.63 times less risky than EDISON INTL. It trades about -0.28 of its potential returns per unit of risk. EDISON INTL is currently generating about -0.31 per unit of risk. If you would invest 3,750 in Gruppo Mutuionline SpA on October 20, 2024 and sell it today you would lose (285.00) from holding Gruppo Mutuionline SpA or give up 7.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gruppo Mutuionline SpA vs. EDISON INTL
Performance |
| Timeline |
| Gruppo Mutuionline SpA |
| EDISON INTL |
Gruppo Mutuionline and EDISON INTL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gruppo Mutuionline and EDISON INTL
The main advantage of trading using opposite Gruppo Mutuionline and EDISON INTL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gruppo Mutuionline position performs unexpectedly, EDISON INTL 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 EDISON INTL will offset losses from the drop in EDISON INTL's long position.| Gruppo Mutuionline vs. FIRST SAVINGS FINL | Gruppo Mutuionline vs. Virtus Investment Partners | Gruppo Mutuionline vs. Entravision Communications | Gruppo Mutuionline vs. TELECOM ITALIA |
| EDISON INTL vs. Webster Financial | EDISON INTL vs. SUN LIFE FINANCIAL | EDISON INTL vs. BE Semiconductor Industries | EDISON INTL vs. REVO INSURANCE SPA |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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