Correlation Between Mytilineos Holdings and Honeywell International
Can any of the company-specific risk be diversified away by investing in both Mytilineos Holdings and Honeywell International 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 Mytilineos Holdings and Honeywell International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mytilineos Holdings SA and Honeywell International, you can compare the effects of market volatilities on Mytilineos Holdings and Honeywell International 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 Mytilineos Holdings with a short position of Honeywell International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mytilineos Holdings and Honeywell International.
Diversification Opportunities for Mytilineos Holdings and Honeywell International
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mytilineos and Honeywell is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Mytilineos Holdings SA and Honeywell International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Honeywell International and Mytilineos Holdings 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 Mytilineos Holdings SA are associated (or correlated) with Honeywell International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Honeywell International has no effect on the direction of Mytilineos Holdings i.e., Mytilineos Holdings and Honeywell International go up and down completely randomly.
Pair Corralation between Mytilineos Holdings and Honeywell International
Assuming the 90 days horizon Mytilineos Holdings SA is expected to under-perform the Honeywell International. In addition to that, Mytilineos Holdings is 3.8 times more volatile than Honeywell International. It trades about 0.0 of its total potential returns per unit of risk. Honeywell International is currently generating about 0.1 per unit of volatility. If you would invest 19,713 in Honeywell International on August 25, 2024 and sell it today you would earn a total of 3,198 from holding Honeywell International or generate 16.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.85% |
| Values | Daily Returns |
Mytilineos Holdings SA vs. Honeywell International
Performance |
| Timeline |
| Mytilineos Holdings |
| Honeywell International |
Mytilineos Holdings and Honeywell International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mytilineos Holdings and Honeywell International
The main advantage of trading using opposite Mytilineos Holdings and Honeywell International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mytilineos Holdings position performs unexpectedly, Honeywell International 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 Honeywell International will offset losses from the drop in Honeywell International's long position.| Mytilineos Holdings vs. Honeywell International | Mytilineos Holdings vs. MDU Resources Group | Mytilineos Holdings vs. Compass Diversified Holdings | Mytilineos Holdings vs. Valmont Industries |
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.
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