Correlation Between NH Foods and Magna International
Can any of the company-specific risk be diversified away by investing in both NH Foods and Magna 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 NH Foods and Magna International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Foods Ltd and Magna International, you can compare the effects of market volatilities on NH Foods and Magna 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 NH Foods with a short position of Magna International. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Foods and Magna International.
Diversification Opportunities for NH Foods and Magna International
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between NIPMY and Magna is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding NH Foods Ltd and Magna International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magna International and NH Foods 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 NH Foods Ltd are associated (or correlated) with Magna International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magna International has no effect on the direction of NH Foods i.e., NH Foods and Magna International go up and down completely randomly.
Pair Corralation between NH Foods and Magna International
If you would invest 4,052 in Magna International on August 31, 2024 and sell it today you would earn a total of 443.00 from holding Magna International or generate 10.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH Foods Ltd vs. Magna International
Performance |
| Timeline |
| NH Foods |
| Magna International |
NH Foods and Magna International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Foods and Magna International
The main advantage of trading using opposite NH Foods and Magna International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Foods position performs unexpectedly, Magna 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 Magna International will offset losses from the drop in Magna International's long position.| NH Foods vs. The A2 Milk | NH Foods vs. Altavoz Entertainment | NH Foods vs. Artisan Consumer Goods | NH Foods vs. Avi Ltd ADR |
| Magna International vs. Allison Transmission Holdings | Magna International vs. Aptiv PLC | Magna International vs. LKQ Corporation | Magna International vs. Lear Corporation |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |