Correlation Between Marfrig Global and Distoken Acquisition
Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Distoken Acquisition 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 Distoken Acquisition 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 Distoken Acquisition, you can compare the effects of market volatilities on Marfrig Global and Distoken Acquisition 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 Distoken Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Distoken Acquisition.
Diversification Opportunities for Marfrig Global and Distoken Acquisition
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Marfrig and Distoken is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Distoken Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Distoken Acquisition 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 Distoken Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Distoken Acquisition has no effect on the direction of Marfrig Global i.e., Marfrig Global and Distoken Acquisition go up and down completely randomly.
Pair Corralation between Marfrig Global and Distoken Acquisition
Assuming the 90 days horizon Marfrig Global Foods is expected to generate 10.23 times more return on investment than Distoken Acquisition. However, Marfrig Global is 10.23 times more volatile than Distoken Acquisition. It trades about 0.09 of its potential returns per unit of risk. Distoken Acquisition is currently generating about 0.06 per unit of risk. If you would invest 191.00 in Marfrig Global Foods on September 14, 2024 and sell it today you would earn a total of 157.00 from holding Marfrig Global Foods or generate 82.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Marfrig Global Foods vs. Distoken Acquisition
Performance |
| Timeline |
| Marfrig Global Foods |
| Distoken Acquisition |
Marfrig Global and Distoken Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marfrig Global and Distoken Acquisition
The main advantage of trading using opposite Marfrig Global and Distoken Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marfrig Global position performs unexpectedly, Distoken Acquisition 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 Distoken Acquisition will offset losses from the drop in Distoken Acquisition's long position.| Marfrig Global vs. BRF SA ADR | Marfrig Global vs. Pilgrims Pride Corp | Marfrig Global vs. John B Sanfilippo | Marfrig Global vs. Seneca Foods Corp |
| Distoken Acquisition vs. GameStop Corp | Distoken Acquisition vs. Valens | Distoken Acquisition vs. Corsair Gaming | Distoken Acquisition vs. Playtika Holding Corp |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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