Correlation Between MGIC Investment and PowerFleet,
Can any of the company-specific risk be diversified away by investing in both MGIC Investment and PowerFleet, 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 MGIC Investment and PowerFleet, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGIC Investment Corp and PowerFleet,, you can compare the effects of market volatilities on MGIC Investment and PowerFleet, 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 MGIC Investment with a short position of PowerFleet,. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGIC Investment and PowerFleet,.
Diversification Opportunities for MGIC Investment and PowerFleet,
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MGIC and PowerFleet, is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding MGIC Investment Corp and PowerFleet, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerFleet, and MGIC Investment 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 MGIC Investment Corp are associated (or correlated) with PowerFleet,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerFleet, has no effect on the direction of MGIC Investment i.e., MGIC Investment and PowerFleet, go up and down completely randomly.
Pair Corralation between MGIC Investment and PowerFleet,
Considering the 90-day investment horizon MGIC Investment is expected to generate 3.29 times less return on investment than PowerFleet,. But when comparing it to its historical volatility, MGIC Investment Corp is 3.79 times less risky than PowerFleet,. It trades about 0.42 of its potential returns per unit of risk. PowerFleet, is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 492.00 in PowerFleet, on September 3, 2024 and sell it today you would earn a total of 212.00 from holding PowerFleet, or generate 43.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MGIC Investment Corp vs. PowerFleet,
Performance |
| Timeline |
| MGIC Investment Corp |
| PowerFleet, |
MGIC Investment and PowerFleet, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGIC Investment and PowerFleet,
The main advantage of trading using opposite MGIC Investment and PowerFleet, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGIC Investment position performs unexpectedly, PowerFleet, 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 PowerFleet, will offset losses from the drop in PowerFleet,'s long position.| MGIC Investment vs. MBIA Inc | MGIC Investment vs. NMI Holdings | MGIC Investment vs. Essent Group | MGIC Investment vs. Assured Guaranty |
| PowerFleet, vs. Hewlett Packard Enterprise | PowerFleet, vs. Juniper Networks | PowerFleet, vs. Motorola Solutions | PowerFleet, vs. Cisco Systems |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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