Correlation Between MTY Food and Northstar Clean
Can any of the company-specific risk be diversified away by investing in both MTY Food and Northstar Clean 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 Northstar Clean 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 Northstar Clean Technologies, you can compare the effects of market volatilities on MTY Food and Northstar Clean 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 Northstar Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and Northstar Clean.
Diversification Opportunities for MTY Food and Northstar Clean
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MTY and Northstar is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and Northstar Clean Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northstar Clean Tech 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 Northstar Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northstar Clean Tech has no effect on the direction of MTY Food i.e., MTY Food and Northstar Clean go up and down completely randomly.
Pair Corralation between MTY Food and Northstar Clean
Assuming the 90 days trading horizon MTY Food is expected to generate 3.1 times less return on investment than Northstar Clean. But when comparing it to its historical volatility, MTY Food Group is 2.32 times less risky than Northstar Clean. It trades about 0.11 of its potential returns per unit of risk. Northstar Clean Technologies is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 25.00 in Northstar Clean Technologies on August 29, 2024 and sell it today you would earn a total of 3.00 from holding Northstar Clean Technologies or generate 12.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
MTY Food Group vs. Northstar Clean Technologies
Performance |
| Timeline |
| MTY Food Group |
| Northstar Clean Tech |
MTY Food and Northstar Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MTY Food and Northstar Clean
The main advantage of trading using opposite MTY Food and Northstar Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, Northstar Clean 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 Northstar Clean will offset losses from the drop in Northstar Clean's long position.| MTY Food vs. Restaurant Brands International | MTY Food vs. Enghouse Systems | MTY Food vs. Metro Inc | MTY Food vs. BRP Inc |
| Northstar Clean vs. Cielo Waste Solutions | Northstar Clean vs. CHAR Technologies | Northstar Clean vs. Forstrong Global Income | Northstar Clean vs. Terreno Resources Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |