Correlation Between USU Software and MTY Food
Can any of the company-specific risk be diversified away by investing in both USU Software and MTY Food 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 USU Software and MTY Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USU Software AG and MTY Food Group, you can compare the effects of market volatilities on USU Software and MTY Food 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 USU Software with a short position of MTY Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of USU Software and MTY Food.
Diversification Opportunities for USU Software and MTY Food
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between USU and MTY is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding USU Software AG and MTY Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTY Food Group and USU Software 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 USU Software AG are associated (or correlated) with MTY Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTY Food Group has no effect on the direction of USU Software i.e., USU Software and MTY Food go up and down completely randomly.
Pair Corralation between USU Software and MTY Food
Assuming the 90 days trading horizon USU Software is expected to generate 3.33 times less return on investment than MTY Food. In addition to that, USU Software is 1.05 times more volatile than MTY Food Group. It trades about 0.1 of its total potential returns per unit of risk. MTY Food Group is currently generating about 0.34 per unit of volatility. If you would invest 3,090 in MTY Food Group on November 3, 2024 and sell it today you would earn a total of 390.00 from holding MTY Food Group or generate 12.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
USU Software AG vs. MTY Food Group
Performance |
| Timeline |
| USU Software AG |
| MTY Food Group |
USU Software and MTY Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USU Software and MTY Food
The main advantage of trading using opposite USU Software and MTY Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USU Software position performs unexpectedly, MTY Food 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 MTY Food will offset losses from the drop in MTY Food's long position.| USU Software vs. ARDAGH METAL PACDL 0001 | USU Software vs. Warner Music Group | USU Software vs. UNIVERSAL MUSIC GROUP | USU Software vs. SIERRA METALS |
| MTY Food vs. MPH Health Care | MTY Food vs. WESANA HEALTH HOLD | MTY Food vs. Penta Ocean Construction Co | MTY Food vs. Australian Agricultural |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |