Correlation Between Mannatech Incorporated and Grocery Outlet
Can any of the company-specific risk be diversified away by investing in both Mannatech Incorporated and Grocery Outlet 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 Grocery Outlet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mannatech Incorporated and Grocery Outlet Holding, you can compare the effects of market volatilities on Mannatech Incorporated and Grocery Outlet 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 Grocery Outlet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mannatech Incorporated and Grocery Outlet.
Diversification Opportunities for Mannatech Incorporated and Grocery Outlet
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mannatech and Grocery is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Mannatech Incorporated and Grocery Outlet Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grocery Outlet Holding 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 Grocery Outlet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grocery Outlet Holding has no effect on the direction of Mannatech Incorporated i.e., Mannatech Incorporated and Grocery Outlet go up and down completely randomly.
Pair Corralation between Mannatech Incorporated and Grocery Outlet
Given the investment horizon of 90 days Mannatech Incorporated is expected to generate 21.18 times more return on investment than Grocery Outlet. However, Mannatech Incorporated is 21.18 times more volatile than Grocery Outlet Holding. It trades about 0.05 of its potential returns per unit of risk. Grocery Outlet Holding is currently generating about -0.02 per unit of risk. If you would invest 1,231 in Mannatech Incorporated on August 31, 2024 and sell it today you would lose (381.00) from holding Mannatech Incorporated or give up 30.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 92.51% |
| Values | Daily Returns |
Mannatech Incorporated vs. Grocery Outlet Holding
Performance |
| Timeline |
| Mannatech Incorporated |
| Grocery Outlet Holding |
Mannatech Incorporated and Grocery Outlet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mannatech Incorporated and Grocery Outlet
The main advantage of trading using opposite Mannatech Incorporated and Grocery Outlet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mannatech Incorporated position performs unexpectedly, Grocery Outlet 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 Grocery Outlet will offset losses from the drop in Grocery Outlet'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 |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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