Correlation Between Mannatech Incorporated and Reckitt Benckiser
Can any of the company-specific risk be diversified away by investing in both Mannatech Incorporated and Reckitt Benckiser 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 Reckitt Benckiser into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mannatech Incorporated and Reckitt Benckiser Group, you can compare the effects of market volatilities on Mannatech Incorporated and Reckitt Benckiser 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 Reckitt Benckiser. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mannatech Incorporated and Reckitt Benckiser.
Diversification Opportunities for Mannatech Incorporated and Reckitt Benckiser
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mannatech and Reckitt is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Mannatech Incorporated and Reckitt Benckiser Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reckitt Benckiser 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 Reckitt Benckiser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reckitt Benckiser has no effect on the direction of Mannatech Incorporated i.e., Mannatech Incorporated and Reckitt Benckiser go up and down completely randomly.
Pair Corralation between Mannatech Incorporated and Reckitt Benckiser
Given the investment horizon of 90 days Mannatech Incorporated is expected to generate 24.7 times more return on investment than Reckitt Benckiser. However, Mannatech Incorporated is 24.7 times more volatile than Reckitt Benckiser Group. It trades about 0.06 of its potential returns per unit of risk. Reckitt Benckiser Group is currently generating about 0.01 per unit of risk. If you would invest 840.00 in Mannatech Incorporated on September 2, 2024 and sell it today you would earn a total of 10.00 from holding Mannatech Incorporated or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.32% |
| Values | Daily Returns |
Mannatech Incorporated vs. Reckitt Benckiser Group
Performance |
| Timeline |
| Mannatech Incorporated |
| Reckitt Benckiser |
Mannatech Incorporated and Reckitt Benckiser Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mannatech Incorporated and Reckitt Benckiser
The main advantage of trading using opposite Mannatech Incorporated and Reckitt Benckiser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mannatech Incorporated position performs unexpectedly, Reckitt Benckiser 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 Reckitt Benckiser will offset losses from the drop in Reckitt Benckiser's long position.| Mannatech Incorporated vs. Seneca Foods Corp | Mannatech Incorporated vs. Central Garden Pet | Mannatech Incorporated vs. Central Garden Pet | Mannatech Incorporated vs. Lifeway Foods |
| Reckitt Benckiser vs. European Wax Center | Reckitt Benckiser vs. Edgewell Personal Care | Reckitt Benckiser vs. Inter Parfums | Reckitt Benckiser vs. Mannatech Incorporated |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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