Correlation Between Multi Ways and Solution Financial
Can any of the company-specific risk be diversified away by investing in both Multi Ways and Solution Financial 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 Multi Ways and Solution Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Ways Holdings and Solution Financial, you can compare the effects of market volatilities on Multi Ways and Solution Financial 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 Multi Ways with a short position of Solution Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Ways and Solution Financial.
Diversification Opportunities for Multi Ways and Solution Financial
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Multi and Solution is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Multi Ways Holdings and Solution Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solution Financial and Multi Ways 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 Multi Ways Holdings are associated (or correlated) with Solution Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solution Financial has no effect on the direction of Multi Ways i.e., Multi Ways and Solution Financial go up and down completely randomly.
Pair Corralation between Multi Ways and Solution Financial
Considering the 90-day investment horizon Multi Ways Holdings is expected to under-perform the Solution Financial. In addition to that, Multi Ways is 1.09 times more volatile than Solution Financial. It trades about -0.17 of its total potential returns per unit of risk. Solution Financial is currently generating about -0.09 per unit of volatility. If you would invest 20.00 in Solution Financial on November 2, 2024 and sell it today you would lose (1.00) from holding Solution Financial or give up 5.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Multi Ways Holdings vs. Solution Financial
Performance |
| Timeline |
| Multi Ways Holdings |
| Solution Financial |
Multi Ways and Solution Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Ways and Solution Financial
The main advantage of trading using opposite Multi Ways and Solution Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Ways position performs unexpectedly, Solution Financial 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 Solution Financial will offset losses from the drop in Solution Financial's long position.| Multi Ways vs. FlexShopper | Multi Ways vs. Hertz Global Holdings | Multi Ways vs. HyreCar | Multi Ways vs. Avis Budget Group |
| Solution Financial vs. Ashtead Group plc | Solution Financial vs. African Discovery Group | Solution Financial vs. Emeco Holdings Limited | Solution Financial vs. BOC Aviation Limited |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |