Correlation Between METTLER TOLEDO and FRASERS PROPERTY
Can any of the company-specific risk be diversified away by investing in both METTLER TOLEDO and FRASERS PROPERTY 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 METTLER TOLEDO and FRASERS PROPERTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between METTLER TOLEDO INTL and FRASERS PROPERTY, you can compare the effects of market volatilities on METTLER TOLEDO and FRASERS PROPERTY 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 METTLER TOLEDO with a short position of FRASERS PROPERTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of METTLER TOLEDO and FRASERS PROPERTY.
Diversification Opportunities for METTLER TOLEDO and FRASERS PROPERTY
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between METTLER and FRASERS is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding METTLER TOLEDO INTL and FRASERS PROPERTY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRASERS PROPERTY and METTLER TOLEDO 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 METTLER TOLEDO INTL are associated (or correlated) with FRASERS PROPERTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRASERS PROPERTY has no effect on the direction of METTLER TOLEDO i.e., METTLER TOLEDO and FRASERS PROPERTY go up and down completely randomly.
Pair Corralation between METTLER TOLEDO and FRASERS PROPERTY
Assuming the 90 days trading horizon METTLER TOLEDO is expected to generate 2.88 times less return on investment than FRASERS PROPERTY. In addition to that, METTLER TOLEDO is 1.01 times more volatile than FRASERS PROPERTY. It trades about 0.02 of its total potential returns per unit of risk. FRASERS PROPERTY is currently generating about 0.05 per unit of volatility. If you would invest 56.00 in FRASERS PROPERTY on August 25, 2024 and sell it today you would earn a total of 8.00 from holding FRASERS PROPERTY or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
METTLER TOLEDO INTL vs. FRASERS PROPERTY
Performance |
| Timeline |
| METTLER TOLEDO INTL |
| FRASERS PROPERTY |
METTLER TOLEDO and FRASERS PROPERTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with METTLER TOLEDO and FRASERS PROPERTY
The main advantage of trading using opposite METTLER TOLEDO and FRASERS PROPERTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if METTLER TOLEDO position performs unexpectedly, FRASERS PROPERTY 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 FRASERS PROPERTY will offset losses from the drop in FRASERS PROPERTY's long position.| METTLER TOLEDO vs. Apple Inc | METTLER TOLEDO vs. Apple Inc | METTLER TOLEDO vs. Apple Inc | METTLER TOLEDO vs. Apple Inc |
| FRASERS PROPERTY vs. Dis Fastigheter AB | FRASERS PROPERTY vs. Superior Plus Corp | FRASERS PROPERTY vs. NMI Holdings | FRASERS PROPERTY vs. Origin Agritech |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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