Correlation Between Mutual Of and Cable One
Can any of the company-specific risk be diversified away by investing in both Mutual Of and Cable One 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 Mutual Of and Cable One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mutual Of America and Cable One, you can compare the effects of market volatilities on Mutual Of and Cable One 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 Mutual Of with a short position of Cable One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mutual Of and Cable One.
Diversification Opportunities for Mutual Of and Cable One
Significant diversification
The 3 months correlation between Mutual and Cable is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Mutual Of America and Cable One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cable One and Mutual Of 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 Mutual Of America are associated (or correlated) with Cable One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cable One has no effect on the direction of Mutual Of i.e., Mutual Of and Cable One go up and down completely randomly.
Pair Corralation between Mutual Of and Cable One
Assuming the 90 days horizon Mutual Of America is expected to under-perform the Cable One. But the mutual fund apears to be less risky and, when comparing its historical volatility, Mutual Of America is 5.37 times less risky than Cable One. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Cable One is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 34,743 in Cable One on August 23, 2024 and sell it today you would earn a total of 5,542 from holding Cable One or generate 15.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mutual Of America vs. Cable One
Performance |
| Timeline |
| Mutual Of America |
| Cable One |
Mutual Of and Cable One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mutual Of and Cable One
The main advantage of trading using opposite Mutual Of and Cable One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mutual Of position performs unexpectedly, Cable One 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 Cable One will offset losses from the drop in Cable One's long position.| Mutual Of vs. Vanguard Target Retirement | Mutual Of vs. ABIVAX Socit Anonyme | Mutual Of vs. SCOR PK | Mutual Of vs. HUMANA INC |
| Cable One vs. Small Cap Core | Cable One vs. FitLife Brands, Common | Cable One vs. Mutual Of America | Cable One vs. Gfl Environmental Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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