Correlation Between MTY Food and Hydreight Technologies
Can any of the company-specific risk be diversified away by investing in both MTY Food and Hydreight Technologies 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 MTY Food and Hydreight Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MTY Food Group and Hydreight Technologies, you can compare the effects of market volatilities on MTY Food and Hydreight Technologies 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 MTY Food with a short position of Hydreight Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and Hydreight Technologies.
Diversification Opportunities for MTY Food and Hydreight Technologies
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MTY and Hydreight is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and Hydreight Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydreight Technologies and MTY Food 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 MTY Food Group are associated (or correlated) with Hydreight Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydreight Technologies has no effect on the direction of MTY Food i.e., MTY Food and Hydreight Technologies go up and down completely randomly.
Pair Corralation between MTY Food and Hydreight Technologies
Assuming the 90 days trading horizon MTY Food is expected to generate 1.82 times less return on investment than Hydreight Technologies. But when comparing it to its historical volatility, MTY Food Group is 5.46 times less risky than Hydreight Technologies. It trades about 0.38 of its potential returns per unit of risk. Hydreight Technologies is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 205.00 in Hydreight Technologies on November 1, 2024 and sell it today you would earn a total of 36.00 from holding Hydreight Technologies or generate 17.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MTY Food Group vs. Hydreight Technologies
Performance |
| Timeline |
| MTY Food Group |
| Hydreight Technologies |
MTY Food and Hydreight Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MTY Food and Hydreight Technologies
The main advantage of trading using opposite MTY Food and Hydreight Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, Hydreight Technologies 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 Hydreight Technologies will offset losses from the drop in Hydreight Technologies' long position.| MTY Food vs. Restaurant Brands International | MTY Food vs. Enghouse Systems | MTY Food vs. Metro Inc | MTY Food vs. BRP Inc |
| Hydreight Technologies vs. InPlay Oil Corp | Hydreight Technologies vs. Plaza Retail REIT | Hydreight Technologies vs. Canso Select Opportunities | Hydreight Technologies vs. Rogers Communications |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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