Correlation Between Marfrig Global and Amexdrug
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Amexdrug 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 Marfrig Global and Amexdrug into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marfrig Global Foods and Amexdrug, you can compare the effects of market volatilities on Marfrig Global and Amexdrug 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 Marfrig Global with a short position of Amexdrug. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Amexdrug.
Diversification Opportunities for Marfrig Global and Amexdrug
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Marfrig and Amexdrug is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Amexdrug in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amexdrug and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with Amexdrug. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amexdrug has no effect on the direction of Marfrig Global i.e., Marfrig Global and Amexdrug go up and down completely randomly.
Pair Corralation between Marfrig Global and Amexdrug
Assuming the 90 days horizon Marfrig Global is expected to generate 6.18 times less return on investment than Amexdrug. But when comparing it to its historical volatility, Marfrig Global Foods is 10.17 times less risky than Amexdrug. It trades about 0.07 of its potential returns per unit of risk. Amexdrug is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Amexdrug on August 25, 2024 and sell it today you would lose (16.80) from holding Amexdrug or give up 98.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marfrig Global Foods vs. Amexdrug
Performance |
| Timeline |
| Marfrig Global Foods |
| Amexdrug |
Marfrig Global and Amexdrug Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marfrig Global and Amexdrug
The main advantage of trading using opposite Marfrig Global and Amexdrug positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Amexdrug 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 Amexdrug will offset losses from the drop in Amexdrug's long position.| Marfrig Global vs. Artisan Consumer Goods | Marfrig Global vs. Aryzta AG PK | Marfrig Global vs. The A2 Milk | Marfrig Global vs. BioAdaptives |
| Amexdrug vs. Genfit | Amexdrug vs. Definitive Healthcare Corp | Amexdrug vs. Datadog | Amexdrug vs. Catalyst Pharmaceuticals |
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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