Correlation Between Mairs Power and Centre American
Can any of the company-specific risk be diversified away by investing in both Mairs Power and Centre American 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 Mairs Power and Centre American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mairs Power Growth and Centre American Select, you can compare the effects of market volatilities on Mairs Power and Centre American 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 Mairs Power with a short position of Centre American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mairs Power and Centre American.
Diversification Opportunities for Mairs Power and Centre American
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mairs and Centre is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mairs Power Growth and Centre American Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centre American Select and Mairs Power 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 Mairs Power Growth are associated (or correlated) with Centre American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centre American Select has no effect on the direction of Mairs Power i.e., Mairs Power and Centre American go up and down completely randomly.
Pair Corralation between Mairs Power and Centre American
Assuming the 90 days horizon Mairs Power Growth is expected to generate 0.4 times more return on investment than Centre American. However, Mairs Power Growth is 2.49 times less risky than Centre American. It trades about -0.28 of its potential returns per unit of risk. Centre American Select is currently generating about -0.25 per unit of risk. If you would invest 18,131 in Mairs Power Growth on October 11, 2024 and sell it today you would lose (1,107) from holding Mairs Power Growth or give up 6.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Mairs Power Growth vs. Centre American Select
Performance |
| Timeline |
| Mairs Power Growth |
| Centre American Select |
Mairs Power and Centre American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mairs Power and Centre American
The main advantage of trading using opposite Mairs Power and Centre American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mairs Power position performs unexpectedly, Centre American 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 Centre American will offset losses from the drop in Centre American's long position.| Mairs Power vs. Meridian Trarian Fund | Mairs Power vs. Mairs Power Balanced | Mairs Power vs. Clipper Fund Inc | Mairs Power vs. Meridian Growth Fund |
| Centre American vs. Jp Morgan Smartretirement | Centre American vs. Tiaa Cref Lifestyle Moderate | Centre American vs. Qs Moderate Growth | Centre American vs. Qs Moderate Growth |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |