Correlation Between Moonpig Group and Seraphim Space
Can any of the company-specific risk be diversified away by investing in both Moonpig Group and Seraphim Space 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 Moonpig Group and Seraphim Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moonpig Group PLC and Seraphim Space Investment, you can compare the effects of market volatilities on Moonpig Group and Seraphim Space 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 Moonpig Group with a short position of Seraphim Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moonpig Group and Seraphim Space.
Diversification Opportunities for Moonpig Group and Seraphim Space
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Moonpig and Seraphim is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Moonpig Group PLC and Seraphim Space Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seraphim Space Investment and Moonpig Group 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 Moonpig Group PLC are associated (or correlated) with Seraphim Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seraphim Space Investment has no effect on the direction of Moonpig Group i.e., Moonpig Group and Seraphim Space go up and down completely randomly.
Pair Corralation between Moonpig Group and Seraphim Space
Assuming the 90 days trading horizon Moonpig Group is expected to generate 154.72 times less return on investment than Seraphim Space. But when comparing it to its historical volatility, Moonpig Group PLC is 1.76 times less risky than Seraphim Space. It trades about 0.01 of its potential returns per unit of risk. Seraphim Space Investment is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 4,855 in Seraphim Space Investment on August 30, 2024 and sell it today you would earn a total of 1,145 from holding Seraphim Space Investment or generate 23.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moonpig Group PLC vs. Seraphim Space Investment
Performance |
| Timeline |
| Moonpig Group PLC |
| Seraphim Space Investment |
Moonpig Group and Seraphim Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moonpig Group and Seraphim Space
The main advantage of trading using opposite Moonpig Group and Seraphim Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moonpig Group position performs unexpectedly, Seraphim Space 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 Seraphim Space will offset losses from the drop in Seraphim Space's long position.| Moonpig Group vs. Home Depot | Moonpig Group vs. Weiss Korea Opportunity | Moonpig Group vs. River and Mercantile | Moonpig Group vs. Chrysalis Investments |
| Seraphim Space vs. Capital Drilling | Seraphim Space vs. Electronic Arts | Seraphim Space vs. Associated British Foods | Seraphim Space vs. Bell Food Group |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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