Correlation Between MGIC Investment and Roblox Corp
Can any of the company-specific risk be diversified away by investing in both MGIC Investment and Roblox Corp 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 Roblox Corp 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 Roblox Corp, you can compare the effects of market volatilities on MGIC Investment and Roblox Corp 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 Roblox Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGIC Investment and Roblox Corp.
Diversification Opportunities for MGIC Investment and Roblox Corp
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MGIC and Roblox is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding MGIC Investment Corp and Roblox Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roblox Corp 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 Roblox Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roblox Corp has no effect on the direction of MGIC Investment i.e., MGIC Investment and Roblox Corp go up and down completely randomly.
Pair Corralation between MGIC Investment and Roblox Corp
Considering the 90-day investment horizon MGIC Investment is expected to generate 2.06 times less return on investment than Roblox Corp. In addition to that, MGIC Investment is 1.23 times more volatile than Roblox Corp. It trades about 0.26 of its total potential returns per unit of risk. Roblox Corp is currently generating about 0.65 per unit of volatility. If you would invest 6,193 in Roblox Corp on November 5, 2024 and sell it today you would earn a total of 914.00 from holding Roblox Corp or generate 14.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
MGIC Investment Corp vs. Roblox Corp
Performance |
| Timeline |
| MGIC Investment Corp |
| Roblox Corp |
MGIC Investment and Roblox Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGIC Investment and Roblox Corp
The main advantage of trading using opposite MGIC Investment and Roblox Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGIC Investment position performs unexpectedly, Roblox Corp 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 Roblox Corp will offset losses from the drop in Roblox Corp's long position.| MGIC Investment vs. MBIA Inc | MGIC Investment vs. NMI Holdings | MGIC Investment vs. Essent Group | MGIC Investment vs. Assured Guaranty |
| Roblox Corp vs. Electronic Arts | Roblox Corp vs. Take Two Interactive Software | Roblox Corp vs. Nintendo Co ADR | Roblox Corp vs. NetEase |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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