Correlation Between Murata Manufacturing and Strix Group
Can any of the company-specific risk be diversified away by investing in both Murata Manufacturing and Strix Group 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 Murata Manufacturing and Strix Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Murata Manufacturing Co and Strix Group Plc, you can compare the effects of market volatilities on Murata Manufacturing and Strix Group 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 Murata Manufacturing with a short position of Strix Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Murata Manufacturing and Strix Group.
Diversification Opportunities for Murata Manufacturing and Strix Group
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Murata and Strix is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Murata Manufacturing Co and Strix Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strix Group Plc and Murata Manufacturing 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 Murata Manufacturing Co are associated (or correlated) with Strix Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strix Group Plc has no effect on the direction of Murata Manufacturing i.e., Murata Manufacturing and Strix Group go up and down completely randomly.
Pair Corralation between Murata Manufacturing and Strix Group
Assuming the 90 days trading horizon Murata Manufacturing Co is expected to generate 0.58 times more return on investment than Strix Group. However, Murata Manufacturing Co is 1.72 times less risky than Strix Group. It trades about -0.01 of its potential returns per unit of risk. Strix Group Plc is currently generating about -0.02 per unit of risk. If you would invest 1,827 in Murata Manufacturing Co on August 27, 2024 and sell it today you would lose (262.00) from holding Murata Manufacturing Co or give up 14.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Murata Manufacturing Co vs. Strix Group Plc
Performance |
| Timeline |
| Murata Manufacturing |
| Strix Group Plc |
Murata Manufacturing and Strix Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Murata Manufacturing and Strix Group
The main advantage of trading using opposite Murata Manufacturing and Strix Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Murata Manufacturing position performs unexpectedly, Strix Group 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 Strix Group will offset losses from the drop in Strix Group's long position.The idea behind Murata Manufacturing Co and Strix Group Plc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Strix Group vs. Japan Tobacco | Strix Group vs. Transport International Holdings | Strix Group vs. Taiwan Semiconductor Manufacturing | Strix Group vs. UPDATE SOFTWARE |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |