Correlation Between MYT Netherlands and SBC Medical
Can any of the company-specific risk be diversified away by investing in both MYT Netherlands and SBC Medical 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 MYT Netherlands and SBC Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MYT Netherlands Parent and SBC Medical Group, you can compare the effects of market volatilities on MYT Netherlands and SBC Medical 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 MYT Netherlands with a short position of SBC Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYT Netherlands and SBC Medical.
Diversification Opportunities for MYT Netherlands and SBC Medical
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MYT and SBC is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding MYT Netherlands Parent and SBC Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBC Medical Group and MYT Netherlands 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 MYT Netherlands Parent are associated (or correlated) with SBC Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBC Medical Group has no effect on the direction of MYT Netherlands i.e., MYT Netherlands and SBC Medical go up and down completely randomly.
Pair Corralation between MYT Netherlands and SBC Medical
Given the investment horizon of 90 days MYT Netherlands Parent is expected to generate 0.73 times more return on investment than SBC Medical. However, MYT Netherlands Parent is 1.37 times less risky than SBC Medical. It trades about 0.09 of its potential returns per unit of risk. SBC Medical Group is currently generating about 0.02 per unit of risk. If you would invest 712.00 in MYT Netherlands Parent on October 12, 2024 and sell it today you would earn a total of 35.00 from holding MYT Netherlands Parent or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MYT Netherlands Parent vs. SBC Medical Group
Performance |
| Timeline |
| MYT Netherlands Parent |
| SBC Medical Group |
MYT Netherlands and SBC Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MYT Netherlands and SBC Medical
The main advantage of trading using opposite MYT Netherlands and SBC Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MYT Netherlands position performs unexpectedly, SBC Medical 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 SBC Medical will offset losses from the drop in SBC Medical's long position.| MYT Netherlands vs. Movado Group | MYT Netherlands vs. Envela Corp | MYT Netherlands vs. Tapestry | MYT Netherlands vs. Capri Holdings |
| SBC Medical vs. East West Bancorp | SBC Medical vs. MYT Netherlands Parent | SBC Medical vs. Fidus Investment Corp | SBC Medical vs. Old Republic International |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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