Correlation Between Mannatech Incorporated and Eastern
Can any of the company-specific risk be diversified away by investing in both Mannatech Incorporated and Eastern 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 Mannatech Incorporated and Eastern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mannatech Incorporated and Eastern Co, you can compare the effects of market volatilities on Mannatech Incorporated and Eastern 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 Mannatech Incorporated with a short position of Eastern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mannatech Incorporated and Eastern.
Diversification Opportunities for Mannatech Incorporated and Eastern
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mannatech and Eastern is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Mannatech Incorporated and Eastern Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern and Mannatech Incorporated 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 Mannatech Incorporated are associated (or correlated) with Eastern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern has no effect on the direction of Mannatech Incorporated i.e., Mannatech Incorporated and Eastern go up and down completely randomly.
Pair Corralation between Mannatech Incorporated and Eastern
Given the investment horizon of 90 days Mannatech Incorporated is expected to generate 1.8 times more return on investment than Eastern. However, Mannatech Incorporated is 1.8 times more volatile than Eastern Co. It trades about -0.03 of its potential returns per unit of risk. Eastern Co is currently generating about -0.21 per unit of risk. If you would invest 826.00 in Mannatech Incorporated on August 28, 2024 and sell it today you would lose (38.00) from holding Mannatech Incorporated or give up 4.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mannatech Incorporated vs. Eastern Co
Performance |
| Timeline |
| Mannatech Incorporated |
| Eastern |
Mannatech Incorporated and Eastern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mannatech Incorporated and Eastern
The main advantage of trading using opposite Mannatech Incorporated and Eastern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mannatech Incorporated position performs unexpectedly, Eastern 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 Eastern will offset losses from the drop in Eastern's long position.| Mannatech Incorporated vs. Edgewell Personal Care | Mannatech Incorporated vs. Inter Parfums | Mannatech Incorporated vs. Nu Skin Enterprises | Mannatech Incorporated vs. Helen of Troy |
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.
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